The fiscal year that ended on January 25th, before the pandemic outbreak, was already in red. Thus, saying that Ted Baker was struggling even before Covid-19 isn’t wrong. The British brand has had to ask investors for 95 million UK pounds to ensure continuity during the pandemic. The fiscal quarter February-May has meant a 36% decrease in revenue. The 95 million received has forced Ted Baker to modify its structure as well.
Ted Baker in crisis
Ted Baker’s sales decreased by 1.4% in the last fiscal year (630.5 million pounds). Compared to last year where the brand made 30.7 million in profits, Ted Baker this year has had recorded income before taxes at -79.9 million. The retailer, according to what reported by RetailGazette, stated that the pandemic caused a 36% decrease in sales, even with a +50% result for the online channel.
The plan presented by the new CEO, Rachel Osborne, is called “Formula For Growth”. This plan should invert the company’s trend, as it has been under stress for a while. There are 3 main goals: solidifying business, growth and operational excellence. Ted Baker will need 95 million pounds from investors, in order to be able to apply the steps and add liquidity to its balance sheet.
The request has forced the retailer to modify its organizational structure, which now operates with 580 stores and concessions. According to The Guardian, Ted Baker’s founder, Ray Kelvin, is not longer majority shareholder. Mr. Kelvin went from 35% to 15.8% ownership, while investment fund Toscafund has almost doubled its shares to 26.4% of the total, effectively becoming majority shareholder.
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