(Reuters) - Fashion retailer Ted Baker warned on Tuesday that underlying profit for this year was likely to come in at least 10 million pounds below analysts’ estimates, citing a “challenging” start to 2019.
Shares of the retailer, which have fallen almost 14% this year as it sought to move on from a misconduct row that forced out founder Ray Kelvin, were expected to sink as much as 25% at opening, according to indications from traders.
A familiar name on Britain’s high street, the company appointed long-time finance chief Lindsay Page to replace Kelvin on a permanent basis in April after posting its first drop in annual profit since the 2008 financial crisis last year.
It also saw shares fall 43% last year as traditional brick and mortar apparel chains suffered in the face of online competitors like Boohoo.com as British consumers worried by the impact of Brexit on the economy sought to rein in spending.
Tuesday’s trading update said management was actively focussing on cost control and new product initiatives to try and turn around results.
“The performance reflects difficult and unpredictable trading conditions, unseasonable weather experienced across North America ... and the highly promotional retail environment across our global markets,” the company said.
“We also experienced some challenges with our Spring/Summer collections and these have been appropriately addressed.”
It expected underlying profit before tax for the year to January 2020 of 50 million pounds to 60 million pounds, compared to a company compiled consensus of 70.9 million pounds and last year’s 63 million pounds.
According to Refinitiv Eikon data, market analysts had been expecting profit before tax of 72.40 million pounds ($91.82 million).
($1 = 0.7885 pounds)
Reporting by Shashwat Awasthi in Bengaluru; editing by Patrick Graham