Clothing chain Ted Baker was hit by profit downgrades today after sales for the 13 weeks to the start of November came in lower than expectations.
Numis and Investec Securities cuts targets for the 2008/09 financial year by 9% after third quarter figures revealed a weakening sales trend.
Ted Baker posted an overall 1.8% increase in revenues for the 13 week period, with turnover from its retail estate ahead 13.3% because of a 17.1% rise in store space. In October the company reported 17.5% growth in retail sales for the 28 weeks to August 9.
It said of recent trading today: “The period was affected by both unseasonably warm weather, in contrast to a period of cold weather last year, and increased economic uncertainty.”
Shares were down nearly 5%, although Numis and Investec said they remained positive on the company overall.
Numis analyst Andrew Wade said: “This was a weak Q3 update from Ted, reflecting the pressure the macro-economic backdrop is having on the consumer.
“The perception of immunity that hung over the luxury and ’bridge’ fashion sub-sectors is slipping away and we can see that even a strong business with a strong brand can do little in the face of rapidly contracting demand.”
Numis cut its pre-tax profits forecast from £23.1m (€27.2m) to £21m (€24.7m) for the current year and by £22.6m (€26m) to £18.6m (€21.9m) for 2009/10.
He added: “We continue to view Ted Baker as an excellent business, with a solid growth story, a great brand and cash on the balance sheet.”
The UK business traded from 29 stores, 92 concessions and ten outlet stores in August, but this has subsequently grown with openings at new shopping centres in Bristol and Liverpool and White City, London.