Fashion group Ted Baker will this week report a fall in annual profits as it battles higher costs, tough trading conditions and the fallout over the departure of its chief executive Ray Kelvin amid misconduct allegations.
The business, founded 30 years in Glasgow by Kelvin, has already flagged that pre-tax profits will come in below last year’s figure of £68.8 million.
But Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, believes current sales at the group will “still be moving in the right direction” despite fierce competition.
“The question will be if that’s coming at the expense of profitability,” she said, adding it was important that any discounting to maintain sales doesn’t put too much pressure on margins.
Kelvin stepped down earlier this month after accusations that a “forced hugging” culture existed at the company, while some staff members complained that he had massaged their ears or asked them to sit on his lap.