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Ted Baker shares hit record high as Dixons sees return to growth

Written by  Published in Investment Wednesday, 28 November 2012 07:43
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Shares in fashion retailer Ted Baker have reached a record high after international expansion drove a better than expected spring performance.

 

The company said sales increased by 32.7% in the 20 weeks to 15 June compared with the same period last year, with both retail sales and wholesale business growing. Ted Baker has grown its international footprint since the start of the year by opening concessions in France, Spain, the Netherlands and Tokyo alongside shops in Shanghai, Adelaide, Beirut and Kuwait.

 

Founder and chief executive Ray Kelvin said: "We are continuing to invest in developing the Ted Baker brand internationally and have been encouraged by the reaction to the brand and the collections in our new markets."

 

The scale of the sales increase appeared to take the City by surprise, with shares soaring 16%, closing up 230p at a record high of £17. Shares in the company have risen 63% in the last year.

 

In the UK, the company is reviewing its store portfolio. It has closed the Kings Road store in London and moved its Stansted Airport store to Gatwick as the airport is being redeveloped.

 

Meanwhile, electrical retailer Dixons, owner of Currys and PC World, saw its UK business return to growth for the first time in several years, as sales rose 7% in the year to 30 April. The company said it was on the road from "survivor to winner" as it benefited from the boom in tablet sales and gained market share following the collapse of its rival Comet.

 

The chief executive, Seb James, claimed that half of the company's growth had come from winning customers from Comet. He added that sales of tablet computers will keep climbing. "There's lots of road left in this particular product. Less than a third of UK households now have a tablet. And there's going to be some further product innovation as these tablets get thinner and lighter and more powerful."

 

The most popular lines are the Apple iPad, the Samsung Galaxy and the Google Nexus.

 

Underlying profit rose 15% to £94.5m, although that swung to a loss of £115.3monce the impact of restructuring its troubled European online business Pixmania was included. Analysts said Pixmania lost £31m and the retailer's southern European stores lost £24m.

 

Dixons ended the year with £42.1m of net cash, having started it with £104m of net debt. James said the return to a cash-positive position had come a year earlier than expected.

 

He added: "That's a big milestone for a business where we were constantly asked how we were going to survive."

 

James also revealed the company has appointed advisors to look at offloading Pixmania.

Read 62874 times Last modified on Monday, 24 June 2013 13:47

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