Ted Baker Ratio Analysis Essay

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Report: Financial Position and Performance of Ted Baker PLC – 2010 to 2013 The following document analyses the financial performance and position of Ted Baker Plc over the last four fiscal years (2010 to 2013) using ratio analysis. The Appendix provided shows the balance sheet, income statement and calculated and graphical representation of the ratio analysis. Overview of 2010-2013 Results: Profitability: The company has shown good profitability over the years and has been a top performer in its peer group. 2012 saw a shift in revenue mix generated from wholesale vs retail (wholesale % increased) which along with expansion and promotional activities oversees, saw a small decline in overall profitability. This then improved in 2013.…show more content…
The general trend of profitability over 2010-2013 is relatively stable with a net positive trend in ROSF, ROCE and gross profit margin. 2012 saw a slight dip in gross profit margin even due to increase in revenue. This was the result of a change in mix between retail and wholesale revenue in favour of wholesale increasing in percentage contribution. The wholesale has smaller margins. There was also an increase in promotional activities in this period. There was an increase in capital employed during 2012 as well as increase in administrative expenses due to expansion activities in USA and IT and distribution infrastructure investment to handle future growth, which resulted in a slight dip in ROSF, ROCE, gross and operating margin even after an overall increase in profits. The dip in ROCE was more significant. On further analysis, it revealed that the company reserved more retained earnings and used a substantial bank overdraft in 2012 to finance their expansion activities. If some of the activities were financed by the retained
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