Fashion retailer Ted Baker sank deeper into trouble on Tuesday after it warned that underlying profit for the year would likely be at least 10 million pounds below analysts' estimates after an "extremely difficult" start to 2019.
Shares of the retailer, which fell 43% last year and another 14% before Tuesday's opening, were down by a quarter in the first few minutes of trading after it blamed promotions and unseasonable weather in North America, which accounts for a third of its revenue. In morning trade, shares of the London-listed stock were down some 25 percent.
A familiar name on Britain's high street, the company appointed long-time finance chief Lindsay Page on a permanent basis in April as it sought to move on from misconduct allegations against its founder and largest shareholder Ray Kelvin.
In March it reported its first drop in annual profit since 2008 as traditional brick and mortar apparel chains suffered in the face of online competitors and British consumers reined in spending.
Tuesday's trading update said the company, which opened its first store in Glasgow in 1988 and now has 560 stores and concessions globally, was focused on reining in costs and coming up with new products to turn the company around.
"We believe the short-term and identifiable issues around product are being addressed swiftly but the unpredictable trading backdrop across all markets appears to have less end in sight," Liberum analysts wrote.
"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.
As a result, gross margins in both its wholesale and retail businesses lagged compared with last year, it added.
It expected underlying profit before tax for the year to January 2020 of 50 million pounds to 60 million pounds, compared with a company compiled consensus of 70.9 million pounds and last year's 63 million pounds.
According to IBES data from Refinitiv, market analysts had been expecting profit before tax of 72.40 million pounds ($91.82 million).
Comparable sales for the 19 weeks from Jan. 27 2019 to June 8 slipped 2.9% on a constant currency basis.