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Pandemic pushes Ted Baker to £107m loss

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·Senior City Correspondent, Yahoo Finance UK
·2-min read
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A promotional image for Ted Baker's latest season of clothing. The retailer was hit hard by COVID. Photo: Ted Baker
A promotional image for Ted Baker's latest season of clothing. The retailer was hit hard by COVID. Photo: Ted Baker

Ted Baker (TED.L) has slumped to a loss of more than £100m ($141m) after the COVID-19 pandemic hammered sales.

The fashion retailer, which was already struggling after accounting issues and the exit of its founder, said on Monday its losses grew by almost 40% to £107.7m in the 12 months to 30 January 2021.

Sales slumped by 44% to £352m as a lost wedding season and a year of working from home left Ted Baker's smart-but-stylish wares out of fashion. The company scrapped its dividend. 

Chief executive Rachel Osborne blamed the impact of the pandemic, which she said had "amplified some of the legacy issues impacting the business". Osborne took over last March in the wake of accounting issues at the business, which was still reeling from the exit of founder in 2019 over a "forced hugging" scandal.

Osborne said Ted Baker was now "in a much stronger place than it was a year ago" and insisted her turnaround plan was on track.

"During the period, we delivered robust cashflow generation, fixed our balance sheet, refreshed our senior leadership team and today we are upgrading our financial targets for the second time since outlining our new strategy last summer," she said. 

"We are a year into Ted Baker's transformation plan and continue to believe that we have the right strategy and team in place to set the business up for a stronger, more sustainable future."

Read more: Shipping industry logjam could hold up Christmas orders

Ted Baker upgraded forecasts for cash generation, saying it now expects to develop a net cash position by the end of 2023. 

Despite the upgrade, current trading remains tough. The company said sales in the first quarter of the new financial year were down 20% on 2020.

Investors focused on the positives and shares ticked 0.3% higher in early trade.

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