Annual Results

Ted Baker PLC

("Ted Baker", the "Group")

Annual Results for the 52 weeks ended 26 January 2013

Highlights

·; Group revenue up 18.0% to £254.5m

·; Retail sales up 19.4% to £208.0m

o UK and Europe retail sales up 11.1% to £165.1m

o US and Canada retail sales up 68.3% to £36.7m

·; Our first retail stores opened in Japan, China and Canada

·; New retail stores opened in London, New York and Hong Kong

·; Our first concessions opened in South Korea, Germany and the Netherlands

·; Wholesale sales up 12.2% to £46.5m

·; Licence income up 11.5% to £7.5m

·; Proposed final dividend of 18.7p bringing total dividend to 26.6p, an increase of 13.7%

·; Second store in China opened in Shanghai since the year end.

Commenting, Ray Kelvin CBE, Founder and Chief Executive, said:

"I am pleased to report another strong performance in what has been a very exciting year for the Ted Baker brand. We have continued to develop our presence internationally with our first stores in Japan, China and Canada and our first concessions in South Korea, Germany and the Netherlands opened during the year.

Since the year end we have opened our second store in China in Shanghai, where we will also open our third store in the middle of the year. Further store and concessions openings are planned across all of our markets.

This strong performance has been achieved despite a challenging and competitive trading environment and is testament to the strength of the brand, our collections and our people. I would like to take this opportunity to thank the entire team for their hard work and Tedication during the year as we continue to build the Ted Baker brand on the world stage."

www.tedbaker.com

www.tedbakerplc.com

Media images available for download at:

http://www.tedbakerplc.com/ted/en/mediacentre/imagelibrary

Notes to editors:

Ted Baker PLC - "No Ordinary Designer Label"

Ted Baker is a leading global lifestyle brand distributing across five continents through its three main distribution channels: retail (including e-commerce); wholesale; and licensing.

Ted Baker has 316 stores and concessions worldwide, comprising of 180 in the UK, 48 in Europe, 53 in North America, 31 in the Middle East and Asia and 4 in Australasia.

Ted Baker offers a wide range of collections including: Menswear; Womenswear; Global; Phormal; Endurance; Born by Ted Baker; Accessories; Lingerie and Sleepwear; Childrenswear; Fragrance and Skinwear; Footwear; Neckwear; Eyewear; and Watches, all of which are underpinned by an unwavering emphasis on design, product quality and attention to detail.

Chairman's Statement

The Group has delivered a strong result across all areas of our business. This performance resulted in an 18.0% increase in Group revenue to £254.5m (2012: £215.6m) and a 16.5% increase to £31.5m (2012: £27.1m) in profit before tax and exceptional costs.

The retail division performed strongly in a competitive trading environment and delivered an increase in revenue of 19.4% to £208.0m (2012: £174.2m), on an increase in average square footage of 14.0%. Gross margins increased to 66.2% (2012: 65.2%).

Wholesale sales for the Group increased by 12.2% to £46.5m (2012: £41.4m). This reflected continued growth in our US wholesale business and a good performance from our UK wholesale business, which also includes the results of our UK export business.

Licence income from our territorial and product licences increased by 11.5% to £7.5m (2012: £6.7m).

This has been a significant year for the Group as we have further established the brand in existing markets and invested in newer markets for the longer term.

Results

Group revenue for the 52 weeks ended 26 January 2013 rose by 18.0% to £254.5m (2012: £215.6m). The composite gross margin increased to 62.4% (2012: 61.3%), reflecting less promotional activity compared to the same period last year.

Profit before tax and exceptional costs increased by 16.5% to £31.5m (2012: £27.1m) and profit before tax increased by 19.2% to £28.9m (2012: £24.3m).

Exceptional costs incurred during the year of £2.6m (2012: £2.8m) included £1.6m of rental costs incurred in the first half of the year in our stores on Fifth Avenue, New York and in Tokyo, Japan for the periods before they commenced trading. The balance of £1.0m includes an impairment charge of £0.8m in respect of some retail assets, notably a retail development in the UK that has failed to deliver on its potential. The remaining £0.2m primarily relates to set up costs incurred for our expansion into China.

Adjusted basic earnings per share, which exclude exceptional costs increased by 15.3% to 56.4p (2012: 48.9p) and basic earnings per share increased by 22.0% to 51.5p (2012: 42.2p).

The Group's net borrowing position at the end of the year was £10.0m (2012: net cash of £1.8m). As anticipated, the reduction in cash was due to the significant investment in capital expenditure during the year and increased inventory to support both the growth and expansion of the Group in the coming year.

Dividends

The Board is recommending a final dividend of 18.7p per share (2012:16.25p), making a total for the year of 26.6p per share (2012: 23.4p per share), an increase of 13.7% on the prior year. Subject to approval by shareholders at the 2013 AGM, the final dividend will be paid on 14 June 2013 to shareholders on the register on 10 May 2013.

People

I would like to take this opportunity to thank all of my colleagues around the world. This performance and the continued development of the brand in new and existing markets is testament to the passion, enthusiasm and commitment of the Ted Baker team.

It was announced on 9 January 2013 that Robert Breare, who had been Non-Executive Chairman since 2002, was stepping down from the Board. I would like to thank Robert for his extraordinary contribution to Ted Baker over the last 11 years. His retail and business experience has greatly benefited the Group during this period of growth and we wish him all the best with his future endeavours.

Following Robert stepping down, I have taken over his duties as Non-Executive Chairman and I will also chair the Board's Nomination Committee. I am incredibly proud to have been associated with Ted Baker since joining the Board in 2003 and I look forward to continuing to work with the Ted Baker team to deliver the exciting opportunities ahead. Ron Stewart, an Independent Non-Executive Director since 2009, has become Senior Independent Non-Executive Director and Anne Sheinfield, an Independent Non-Executive Director since 2010, has become Chairman of the Remuneration Committee.

It is with great sadness that I have to report that David Hewitt, a colleague and fellow director passed away at the end of last year. David was a Non-Executive Director of the Company from its flotation in July 1997 until retirement in July 2009. He was passionate about the product and worked closely with the team across the business, providing valuable advice that greatly benefitted the Company over his twelve year tenure. He will be sadly missed by his colleagues.

Current Trading and Outlook

The Ted Baker brand continues to perform strongly and we are pleased by the initial positive reaction to our Spring/Summer collections. We continue to build brand awareness in our newer markets, where we are investing for the longer term, and further retail openings are planned across all of our markets.

Retail

The new financial year has started well at this early stage, particularly in the UK, where we will be opening two stores within Gatwick Airport; an accessory only store in the Gatwick North terminal in June and a store in the Gatwick South terminal towards the end of the year. We will be launching a new e-commerce platform in the second half of the year to support our anticipated growth, including the opportunity for local language sites as we expand internationally. This will also include more localised and personalised content based upon browsing and shopping behaviours including currency and delivery options specific to each country.

In Europe, we will be opening our first outlet store in Belgium in July. We are also looking to open further concessions in Germany, Spain, France and the Netherlands.

In the US, we plan to open a further eight concessions during the year. We also plan to open our first outlet store in Toronto, Canada later in the year.

In Asia, we have very recently opened a second store in Shanghai, China and a further concession through a leading department store in Tokyo, Japan. We will be opening another store in Shanghai in the middle of the year, as well as our first outlet store in Shanghai in April.

Wholesale

Trading in our wholesale business has started well and in line with our expectations. We anticipate further growth in our US wholesale business and export business in the coming year, with sales from our UK wholesale business slightly above last year. Overall, this should result in single digit growth in our wholesale business in the coming year.

Licence Income

Our product and territorial licences continue to perform well and are in line with expectations.

Our licence partners plan to open stores in Beirut, Adelaide, Abu Dhabi, Kuwait and Lebanon during the coming year.

Group

We have continued to deliver a good performance in an uncertain trading environment and, through maintaining our focus on the long term development of the brand, we believe that we are well placed to deal with the challenges and opportunities ahead. We continue to ensure that our costs and commitments are controlled and in line with trends anticipated for the coming year.

We will continue to develop our retail, wholesale and licensing distribution strategy across new and existing markets.

We intend to make our next interim management statement, covering trading since the start of the financial year in mid June 2013.

David Bernstein

Non-Executive Chairman

21 March 2013

Business Review

OUR BUSINESS

Ted Baker is a leading designer brand that operates through three main distribution channels: retail; wholesale; and licensing. We offer a wide range of collections including: Menswear; Womenswear; Global; Phormal; Endurance; Born by Ted Baker; Accessories; Lingerie and Sleepwear; Childrenswear; Fragrance and Skinwear; Footwear; Neckwear; Eyewear; and Watches.

The brand has grown steadily from its origins as a single shirt specialist store in Glasgow to the global business it is today. We distribute through our own and licensed retail outlets, leading department stores and selected independent stores in Europe, North America, the Middle East, Asia and Australasia.

Our strategy is to become a leading global designer brand, based on three main elements:

·; considered expansion of the Ted Baker collections. We review our collections continually to ensure we react to trends and meet our customers' expectations. In addition, we look for opportunities to extend the breadth of collections and enhance our offer;

·; controlled distribution through three main channels: retail; wholesale; and licensing. We consider each new opportunity to ensure it is right for the brand and will deliver margin led growth; and

·; carefully managed development of overseas markets. We continue to manage growth in existing territories while considering new territories for expansion.

Underlying our strategy is an emphasis on design, product quality and attention to detail, which is delivered by the passion, commitment and dedication of our teams, licence partners and wholesale customers ("trustees").

GLOBAL GROUP PERFORMANCE

Retail

We operate stores and concessions across the UK, Europe, North America and Asia, an e-commerce business based in the UK, primarily serving the UK and Europe, with a separate site dedicated to the Americas and an e-commerce business with some of our concession partners.

The retail division delivered a strong performance with sales up 19.4% to £208.0m (2012: £174.2m). Average retail square footage rose by 14.0% over the year to 274,531 sq ft (2012: 240,815 sq ft). Total retail square footage at 26 January 2013 was 294,329 sq ft (2012: 253,635 sq ft), an increase of 16.0% on the prior year. Retail sales per square foot rose 2.6% from £685 to £703.

Sales through our e-commerce business increased by 63.7% to £14.9m (2012: £9.1m). In April, we launched a mobile optimised transactional site and the response from our customers has been very positive. Our e-commerce business continues to benefit from the enhancements to our UK based transactional site.

The retail gross margin increased to 66.2% (2012: 65.2%), reflecting a lower level of promotional activity in our markets compared to the same period last year.

Retail operating costs increased in line with our expectations to £100.1m (2012: £81.2m) and as a percentage of retail sales rose to 48.1% (2012: 46.6%), primarily driven by our expansion into new international markets. This resulted in a slight decrease in retail operating contribution to 18.1% (2012: 18.5%).

Wholesale

We currently operate a wholesale business in the UK serving countries across Europe and a wholesale business in the US.

Group wholesale sales increased by 12.2% to £46.5m (2012: £41.4m) and the gross margin was in line with last year at 45.2% (2012: 45.1%). The increase in sales predominantly reflects a good performance from our UK wholesale business and continuing growth in both our wholesale export business and our US wholesale business.

Licence income

We operate both territorial and product licences. Our territorial licences cover the Middle East, Asia and Australasia, through which we operate licenced retail stores and, in some territories, wholesale operations. Our product licences cover lingerie & sleepwear, fragrance, watches, footwear, eyewear, neckwear, skinwear and childrenswear.

Licence income was up 11.5% to £7.5m (2012: £6.7m). We have seen particularly good performances from our footwear collection with our licenced partner, Pentland Group and from our childrenswear collection and lingerie and sleepwear collections with Debenhams. Our licensed stores in the Middle East and Asia performed well during the period.

Collections

Ted Baker Womenswear delivered a strong performance with sales up 27.7% to £137.1m (2012: £107.4m). Womenswear benefited from a greater proportion of the space added during the period and as a result represented 53.9% of total sales (2012: 49.8%).

Ted Baker Menswear performed well with sales increasing by 8.4% to £117.4m (2012: £108.3m). Menswear represented 46.1% of total sales in the period (2012: 50.2 %).

GEOGRAPHIC PERFORMANCE

United Kingdom and Europe

Sales in our UK and Europe retail division were up 11.1% to £165.1m (2012: £148.6m). This good performance was delivered in a competitive trading environment.

Average retail square footage rose by 5.7% over the period to 204,331 sq ft (2012: 193,389 sq ft). At 26 January 2013 total retail square footage was 210,768 sq ft (2012: 201,223 sq ft) representing an increase of 4.7%. Retail sales per square foot increased by 2.1% from £723 to £738.

During the year, we opened stores on the Brompton Road, London and in Heathrow Terminal Three, both of which performed well. We also opened concessions with leading department stores in Germany, the Netherlands, Ireland and Spain and are pleased with their performances.

At 26 January 2013, we operated 35 stores (2012: 33), 183 concessions (2012: 169) and 10 outlet stores (2012: 10).

Our e-commerce business performed exceptionally well during the period with sales increasing by 62.5% to £14.3m (2012: £8.8m)

Sales from our UK wholesale division increased by 10.1% to £39.1m (2012: £35.5m) reflecting a good performance from our UK wholesale business and continued growth in our wholesale export business.

US and Canada

Sales from our US and Canadian retail division increased by 68.3% to £36.7m (2012: £21.8m).

In support of our strategy to build our multi-channel business and raise brand awareness, during the year we opened a flagship store on Fifth Avenue, New York, a further twenty two concessions throughout a leading department store and an outlet store in Woodbury Common, New York. We continue to make good progress and are confident that our prominent store on Fifth Avenue is helping to raise brand awareness of the Ted Baker brand in the US and internationally. We also opened our first store in Toronto, Canada in November and its performance has been good.

Average square footage rose by 38.9% to 59,384 sq ft (2012: 42,761 sq ft) and retail sales per square foot increased 20.9% from £502 to £607. This reflects both higher sales densities in the concessions opened during the year and an improvement in consumer confidence in this market. As at 26 January 2013, we had 16 stores (2012: 14), 33 concessions (2012: 11) and 4 outlet stores (2012: 3).

Sales from our US wholesale business increased by 25.3% to £7.5m (2012: £6.0m) reflecting the continued growth of our business.

Middle East, Asia and Australasia

We continue to develop the Ted Baker brand across the Middle East and Australasia. In Asia, with the help of our licence partners, we are in the early stages of investing in new markets for the longer term development of the brand. As at 26 January 2013, we, together with our licence partners, operated a total of 35 stores (2012: 26 stores) across these territories.

Our licensed stores across the Middle East performed particularly well during the period and as a result our partners are seeking further opportunities to expand in the region. One of our licence partners opened another store in Kuwait during the year. As at 26 January 2013, our licence partners operated 8 stores across the Middle East (2012: 7 stores).

Our expansion into new international markets continued with an opening in Tokyo, Japan in February 2012 and four concessions through leading department stores in South Korea in March and November 2012. We also opened our first store in Beijing, China in September. These openings reflect our strategy to invest for the longer term development of the brand and we have been encouraged by the initial reaction to the brand and our collections in these new markets.

In June, our licence partner opened stores in the Plaza Senayan Mall in Jakarta, Indonesia, the Suria Mall in Kuala Lumpar, Malayasia and the ION Mall in Singapore. In July, we opened a third store in Hong Kong under our own management and the brand continues to be well received in the region. During the period two existing stores were closed and, as a result, as at 26 January 2013, we, together with our licence partners, operated a total of 23 stores across the Middle East and Asia (2012: 15)

The joint venture with our Australasian licence partner, Flair Industries Pty Ltd, continues to perform in line with our expectations. As at 26 January 2013, we operated 4 stores in Australasia (2012: 4 stores).

Financial Review

Revenue and Gross Margin

Group revenue increased by 18% to £254.5m (2012: £215.6m), driven by a 19.4% increase in retail sales to £208.0m (2012: £174.2m) and a 12.2% increase in wholesale sales to £46.5m (2012: £41.4m).

The composite gross margin for the Group was 62.4% (2012: 61.3%). This increase reflects a lower level of promotional activity in our markets compared to the same period last year.

Operating Expenses Pre-Exceptional Costs

Distribution costs increased in line with our expectations to £101.4m (2012: £82.4m) and as a percentage of sales increased to 39.8% (2012: 38.2%), which was primarily driven by our expansion into new international markets and included pre-opening costs of £0.4m (excluding exceptional costs discussed below) in respect of stores before they commenced trading.

Administration expenses increased by 11.3% to £33.0m (2012: £29.6m). Excluding the employee performance related bonus of nil (2012: £3.1m), administration expenses rose by 24.5% reflecting growth in the US team to support the growth in our retail and wholesale businesses, growth in other central functions and the continued development of our distribution and information technology infrastructures to support our expansion into international markets.

Exceptional costs

The exceptional costs, which include both distribution costs and administration expenses, incurred during the year of £2.6m (2012: £2.8m) included £1.6m of rental costs incurred in the first half of the year in our stores on Fifth Avenue, New York and in Tokyo, Japan for the periods before they commenced trading. The balance of £1.0m includes an impairment charge of £0.8m in respect of some retail assets, notably a retail development in the UK that has failed to deliver on its potential. The remaining £0.2m primarily relates to set up costs incurred for our expansion into China.

The prior year figure was in respect of rent for stores that would not commence trading until 2012, set up costs in relation to our expansion into China and a provision for bad and doubtful debts in respect of our exposure in Greece.

Profit Before Tax

Profit before tax and exceptional costs increased by 16.5% to £31.5m (2012: £27.1m) and profit before tax increased by 19.2% to £28.9m (2012: £24.3m).

Finance Income and Expenses

Net interest payable during the year was £612,000 (2012: £201,000). This increase reflects higher Group borrowing compared to the prior year due to significant capital expenditure and increased working capital to support the Group around the world.

The foreign exchange loss during the year of £178,000 (2012: gain of £38,000) was due to the retranslation of monetary assets and liabilities denominated in foreign currencies.

Taxation

The Group tax charge for the year was £7.3m (2012: £6.7m), an effective tax rate of 25.3% (2012: 27.6%). This reduction from the prior year reflects the fall in the UK corporation tax rate from 1 April 2012. This effective tax rate is higher than the UK rate of 24.32% largely due to the non-recognition of losses in overseas territories where the businesses are still in their development phase. The Autumn Statement on 5 December 2012 confirmed that the main Corporation Tax rate from 1 April 2013 will fall to 23% with a further reduction to 21% from 1 April 2014. In the Budget Statement on 20 March 2013, a further cut in corporation tax rate to 20% was announced which will take effect from 1 April 2015. We would expect to see a future reduction in our effective tax rate in line with these changes although the rate will be impacted where future overseas profits arise in jurisdictions with higher tax rates than the UK.

Cash Flow

The net decrease in cash and cash equivalents was the same as for last year at £11.9m (2012: £11.9m). An increase in net cash generated from operating activities of £6.2m was offset by an increase in financing and investing activities.

Total working capital as per the Group balance sheet, which comprises inventories, trade and other receivables and trade and other payables, increased by £13.8m to £61.0m (2012: £47.2m), principally as a result of an increase in year end inventory levels reflecting the underlying growth of our business and the earlier phasing of deliveries into the business to ensure smooth transition to the Spring/Summer season across all our markets.

Capital expenditure of £19.8m as per the Group cash flow (2012: £15.0m) reflected the opening and refurbishment of stores, concessions and outlets and the continued investment in the infrastructure of the business. Included within this figure is £1.6m (2012: £3.7m) of expenditure which relates to stores that are due to open in 2013.

Shareholder Return

Basic earnings per share increased by 22.0% to 51.5p (2012: 42.2p). Adjusted earnings per share, which exclude exceptional costs of £2.6m (2012: £2.8m), increased by 15.3% to 56.4p (2012: 48.9p).

The proposed final dividend of 18.7p per share will make a total for the year of 26.6p per share (2012: 23.4p per share), an increase of 13.7% on the previous year.

Free cash flow per share, which is calculated using the net cash generated from operating activities, was 41.0p (2012: 26.7p) and reflected an increase in cash generated from operating activities.

Currency Management

The most significant exposure to foreign exchange fluctuation relates to purchases made in foreign currencies, principally the US Dollar and the Euro.

A proportion of the Group's purchases are hedged in accordance with the Group's risk management policy, typically 12 months in advance. The balance of purchases is hedged naturally as the business operates internationally and income is generated in the local currencies.

At the balance sheet date, the Group had hedged its projected commitments in respect of the year ending January 2014.

Borrowing Facilities

The Group has a three year committed borrowing facility of £40.0m (2012: £40.0m), which is due to expire on 1 March 2015. The facility is a multi-currency revolving credit facility with The Royal Bank of Scotland and Barclays. The facility is used as necessary to fund capital expenditure to support the Group's growth strategy.

The facilities contain appropriate financial covenants and are tested on a quarterly basis. The Group monitors actual and prospective compliance with these on a regular basis.

Principal Risks and Uncertainties

The Board recognises there are a number of risks and uncertainties that face the Group. The Board, with the help of the chief executive, the finance director and subsidiary directors (the "Executive Committee"), has established a structured approach to identify, access and manage these risks and this is regularly monitored and updated by the Risk Committee. Although not exhaustive, the following list highlights some of the principal risks which are not shown in order of importance:

Group Income Statement

For the 52 weeks ended 26 January 2013

Group Statement of Comprehensive Income

For the 52 weeks ended 26 January 2013

Group Statement of Changes in Equity

For the 52 weeks ended 26 January 2013

Group Statement of Changes in Equity

For the 52 weeks ended 28 January 2012

Company Statement of Changes in Equity

For the 52 weeks ended 26 January 2013

For the 52 weeks ended 28 January 2012

Group and Company Balance Sheet

At 26 January 2013

These financial statements were approved by the Board of Directors on 21 March 2013 and were signed on its behalf by:

L D Page

Director

Group and Company Cash Flow Statement

For the 52 weeks ended 26 January 2013

Notes to the Financial Statements

For the 52 weeks ended 26 January 2013

1. Basis of preparation

EU law (IAS Regulation EC 1606/2002) requires that the Group financial statements, for the 52 weeks ended 26 January 2013, are prepared in accordance with International Financial Reporting Standards (IFRSs) adopted for use in the EU ("adopted IFRSs").

This financial information has been prepared on the basis of the recognition and measurement requirements of adopted IFRSs as at 26 January 2013.

The financial information set out above does not constitute the Group's statutory accounts for the 52 weeks ended 26 January 2013 or 52 weeks ended 28 January 2012. The annual financial information presented in this annual results announcement for the 52 weeks ended 26 January 2013 is based on, and is consistent with, that in the Group's audited financial statements for the 52 weeks ended 26 January 2013, and those financial statements will be delivered during the second week of May 2013. The auditor's report on those financial statements is unqualified and does not contain any statement under Section 498 (2) or (3) of the Companies Act 2006.

Statutory accounts for 28 January 2012 have been delivered to the registrar of companies. The auditors' have reported on those accounts; their reports were i) unqualified and, ii) did not contain statements under Section 498 (2) or (3) of the Companies Act 2006.

Going concern

The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Business Review on pages 6 to 8. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in the Chairman's Statement on pages 3 and 4. In addition the Group's financial statements include the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and hedging activities; and its exposures to credit risk and liquidity risk.

The Group's forecasts and projections, taking into account reasonably possible changes in trading performance, show that the Group has sufficient financial resources. As a consequence the Directors have a reasonable expectation that the Company and the Group are well placed to manage their business risks and to continue in operational existence for the foreseeable future, despite the current uncertain global economic outlook. Accordingly, the Directors continue to adopt the going concern basis in preparing the consolidated financial statements

Non-GAAP performance measures

The directors believe that the profit before exceptional items and adjusted earnings per share measures provide additional useful information for shareholders on the underlying performance of the business. These measures are consistent with how underlying business performance is measured internally.

The exceptional profit before tax measure is not a recognised profit measure under IFRS and may not be directly comparable with adjusted profit measures used by other companies.

Exceptional items in the current year include:

·; Significant pre-opening costs (including rental and others) for new store openings

·; An impairment charge in respect to some retail assets, notably a retail development in the UK that has failed to deliver on its potential

·; Costs incurred in relation to expansion into new markets

Significant accounting policies

Except as described below, the accounting policies applied by the Group in this annual results announcement are the same as those applied by the Group in its consolidated financial statements for the 52 weeks ended 28 January 2013.

There were no revisions to adopted IFRS that became applicable in the period which had a significant impact on the Group's financial statements

The Group does not consider that any other standards, amendments or interpretations issued by the IASB, but not yet applicable, will have a significant impact on the financial statements in future years.

2. Segment information

The Group has three reportable segments; retail, wholesale and licence income.

For each of the three segments, the Group's chief operating decision maker (the "Board") reviews internal management reports on a four weekly basis.

Information regarding the results of each reportable segment is included below. Performance for the retail segment is measured based on operating contribution, whereas performance of the wholesale segment is measured based on gross profit and performance of the licence segment is measured based on royalty income, as included in the internal management reports that are reviewed by the Board.

Segment results are used to measure performance as management believes that such information is the most relevant in evaluating the performance of certain segments relative to other entities that operate within these industries. Inter-segment pricing is determined on an arm's length basis.

a) Segment revenue and segment result

Wholesale sales are shown after the elimination of inter-company sales of £28,714,000 (2012: £20,348,000).

b) Geographical information

*Non-current assets exclude deferred tax assets.

c) Revenue by collection

3. Profit before tax

The exceptional costs incurred during the year of £2.6m (2012: £2.8m) are in respect of £1.6m rent paid in advance for stores that did not commence trading until the first half of the period. The balance of £1.0m includes an impairment charge of £0.8m in respect of some retail assets, notably a retail development in the UK that has failed to deliver on its potential. The remaining £0.2m relates primarily to set up costs incurred for our expansion into China.  

The exceptional costs incurred during the 52 weeks to 28 January 2012 were in respect of rent paid in advance for stores that did not commence trading until the first half of 2012, set up costs in relation to our expansion into China and provision for bad and doubtful debts in respect of our exposure in Greece

4. Finance income and expenses

5. Income tax expense

a) The tax charge comprises

b) Deferred tax movement by type

c) Factors affecting the tax charge for the period

The tax assessed for the period is higher than the tax calculated at domestic rates applicable to profits in the respective countries. The differences are explained below.

d) Deferred and current tax recognised directly in equity

There was a reduction in the UK corporation tax rate from 26% to 24% with effect from 1 April 2012. There are further proposed reductions such that the headline rate will decrease to 20% by 1 April 2015.

As the deferred tax assets and liabilities should be recognised based on the corporation tax rate substantively enacted at the balance sheet date, the assets and liabilities have been recognised at a rate of 23%. In the Budget on 20 March 2013, the Chancellor announced a further cut in corporation tax rate to 20% from 1 April 2015. Had this tax rate change been substantively enacted before the balance sheet date, it would have had the effect of reducing the net deferred tax liability on UK operations by a further £65,000.

6. Dividends per share

A final dividend in respect of 2013 of 18.7p per share, amounting to a dividend payable of £7,964,151, is to be proposed at the Annual General Meeting on 20 June 2013.

7. Earnings per share

Own shares held by the Ted Baker Group Employee Benefit Trust, the Ted Baker 1998 Employee Benefit Trust and treasury shares have been eliminated from the weighted average number of ordinary shares. The options exercised during the year, and conditional share awards distributed, if they vest, are covered by shares held either in treasury or by these Trusts.

Diluted earnings per share have been calculated using additional ordinary shares of 5p each available under the 1997 Unapproved Share Option Scheme, the 1997 Executive Share Option Scheme, the Ted Baker Performance Share Plan and the Ted Baker 2009 VCP.

There were no share related events after the balance sheet date that may affect earnings per share.

* Adjusted profit for the period and adjusted earnings per share are shown before the exceptional costs of £2,038,000 (2012: £2,814,000).

8. Property, plant and equipment

Additions included within the assets under construction category are stated net of transfers to other property, plant and equipment categories. Transfers from the assets under construction category in the period amounted to £3,725,000 (2012: £1,031,000) whilst additions into this category were £1,637,000 (2012: £3,725,000).

The impairment charge for the 52 weeks ended 26 January 2013 includes a charge in respect to some retail assets, notably a retail development in the UK that has failed to deliver on its potential.

Impairment of property, plant and equipment

The Group has determined that for the purposes of impairment testing, each store and outlet is a cash-generating unit. Cash-generating units are tested for impairment if there are indications of impairment at the balance sheet date.

Recoverable amounts for cash-generating units are based on value in use, which is calculated from cash flow projections using data from the Group's latest internal forecasts, the results of which are reviewed by the Board. The key assumptions for the value in use calculations are those regarding discount rates, growth rates and expected changes in margins. Management estimates discount rates using pre-tax rates that reflect the current market assessment of the time value of money and the risks specific to the cash-generating units. Changes in selling prices and direct costs are based on past experience and expectations of future changes in the market.

The pre-tax discount rate used to calculate value in use is derived from the Group's weighted average cost of capital.

The impairment losses relate to stores whose recoverable amounts (value in use) did not exceed the asset carrying values. In all cases, impairment losses arose due to stores performing below projected trading levels.

9. Related Parties

The Company has a related party relationship with its directors and executive officers.

Directors of the Company and their immediate relatives control 38.8 per cent of the voting shares of the Company.

At 26 January 2013, No Ordinary Designer Label Limited ("NODL"), the main trading company owed Ted Baker PLC £34,376,000 (2012: £30,053,000). NODL was owed £57,111,000 (2012: £38,987,000) from the other subsidiaries within the Group.

Transactions between subsidiaries were priced on an arms length basis.

The Group has a 50% interest in a joint venture, with Flair Industries Pty Ltd. As at 26 January 2013, the joint venture owed £225,000 to the main trading company (2012: £407,000). In the period the value of sales made to the joint venture by the Group was £808,000 (2012: £726,000).

The Group considers the Board of executive directors as key management.

Responsibility statement of the directors in respect of the Annual Results

We, the directors of the Company, confirm that to the best of our knowledge:

(a) the financial statements, prepared in accordance with International Financial Reporting Standards as adopted by the EU, give a true and fair view of the assets, liabilities, financial position and profit for the Group and the undertakings included in the consolidation taken as a whole; and

(b) pursuant to Chapter 4 of the Disclosure and Transparency Rules, the Group's annual results contains a fair review of the development and performance of the business and the position of the Group, and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

On behalf of the Board

Cautionary statement regarding forward-looking statements

This document contains certain forward-looking statements. These forward-looking statements include matters that are not historical facts or are statements regarding the Company's intentions, beliefs or current expectations concerning, among other things, the Company's results of operations, financial condition, liquidity, prospects, growth, strategies, and the industries in which the Company operates. Forward-looking statements are based on the information available to the directors at the time of preparation of this document, and will not be updated during the year. The directors can give no assurance that these expectations will prove to be correct. Due to inherent uncertainties, including both economic and business risk factors underlying such forward-looking information, actual results may differ materially from those expressed or implied by these forward-looking statements.