In the early phase of the credit crunch many were convinced that the cachet of Ted’s threads would make the retailer better placed than others to weather tough trading.
But in its January update the retailer revealed that profits would come in at the lower end of expectations – between£19m and£23m – after high street conditions necessitated greater promotions and gross margins fell 2.5 per cent.
Panmure Gordon brought its forecast back from£20m to£18.9m but said: “While the news on the gross margin was not great, we do not think Ted Baker needs to change course and would still buy shares.”
Panmure analyst Philip Dorgan believes the retailer could increase profits to£30m over the next three years, “given the investment in the brand and outlets”.
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