Ted Baker Warns of Challenges Ahead

LONDON, United Kingdom — British fashion retailer Ted Baker Plc on Thursday cautioned against a tough global environment ahead, sending its shares down more than 5 percent in early trade.

The warning came despite a 12 percent rise in annual pretax profit on the back of higher online sales.

The retailer, which operates 532 stores and concessions worldwide, said it expects capital expenditure of £30 million in the new financial year, down from £36.6 million in the prior year.

"The recent unseasonal weather across Europe and the East Coast of America has had an impact on the early part of trading for Spring/Summer," the company said.

Ted Baker, unlike it peers, has been going slow on new store openings and has re-modelled existing outlets to compliment its online offering in the face of a decline in the overall British clothing market.

Full-year online sales jumped 39.8 percent to £101.1 million ($143.28 million), accounting for 22.8 percent of retail sales.

The company, which trades from outlets, standalone showrooms and concessions, said group pretax profit rose to £68.8 million for the year ended January 27, from £61.3 million a year earlier.

Retail sales in its UK and Europe business rose 7.7 percent to £301.1 million.

The company also raised its full-year dividend by 12.1 percent to 60.1 pence.

By Rahul B and Radhika Rukmangadhan; editors: Amrutha Gayathri and Subhranshu Sahu.