Final Results

Ted Baker PLC

("Ted Baker", the "Group")

Annual Results for the 52 weeks ended 28 January 2012

Excellent Group performance and investing in strong

foundations for our future

Highlights

·; Retail sales up 14.1% on a 6.6% increase in average retail square footage

o UK and Europe retail sales up 8.7% to £148.6m

o US retail sales up 69.4% to $34.9m

·; New retail stores opened in Manchester, Paris, Hong Kong and San Diego

·; New retail concessions opened in the US, Spain and Portugal

·; Wholesale sales up 18.5% to £41.4m

·; Licence income up 8.1% to £6.7m

·; Proposed final dividend of 16.25p, making the total dividend 23.4p, an increase of 13.6%

·; First store opened in Tokyo, Japan and first concession opened in Seoul, Korea since the year end

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

"This has been a very exciting year for the Ted Baker brand. We have further developed our presence in established markets with new stores in Europe, the US and Hong Kong and laid strong foundations to support growth into new markets in 2012 with the recent openings of our first store in Japan and an opening in Korea as well as exciting new openings planned in London, Fifth Avenue, New York, Toronto, Canada and China later this year.

The Group's excellent results for the year, delivered against a challenging trading backdrop, are testament to the strength of the Ted Baker brand, our collections and, above all, the energy and commitment of our team in bringing Ted to the world stage. I would like to take this opportunity to thank them all for their Tedication."

www.tedbaker.com

www.tedbakerplc.com

Media images available for download at:

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

Chairman's Statement

The Group has delivered an excellent result against a challenging back drop. This strong performance resulted in a 14.9% increase in Group revenue to £215.6m (2011: £187.7m) and an 11.7% increase to £27.1m in profit before tax and exceptional costs.

The retail division performed well across all markets and delivered an increase in revenue of 14.1% to £174.2m, on an increase in average square footage of 6.6%. Gross margins were broadly maintained at 65.2% (2011: 65.5%).

Wholesale sales for the Group increased by 18.5% to £41.4m (2011: £35.0m). This reflected a good performance from our UK wholesale business, which also includes the results of our UK export business, and the continued growth of our US wholesale business, which contributed its first full year of trading under our own management.

Licence income from our territorial and product licences increased by 8.1% to £6.7m (2011: £6.2m).

Results

Group revenue for the 52 weeks ended 28 January 2012 rose by 14.9% to £215.6m (2011: £187.7m). The composite gross margin has decreased slightly to 61.3% (2011: 61.7%), reflecting a change in mix between retail and wholesale sales whilst input margins were largely maintained.

Profit before tax and exceptional costs increased by 11.7% to £27.1m (2011: £24.2m) and profit before tax was slightly above the prior year at £24.3m (2011: £24.2m).

Adjusted basic earnings per share excluding exceptional costs increased by 17.8% to 48.9p (2011: 41.5p) and basic earnings per share increased by 1.7% to 42.2p (2011: 41.5p).

Exceptional costs incurred during the year of £2.8m (2011: nil) are in respect of rent for stores that will 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.

The Group's net cash position at the end of the year was £1.8m (2011: £13.5m). The reduction in cash was due to our investment in inventory and capital expenditure in anticipation of the planned expansion of the Group in the coming year.

Dividends

The Board is recommending a final dividend of 16.25p per share, making a total for the year of 23.4p per share (2011: 20.6p per share), an increase of 13.6% on the prior year. Subject to approval, the final dividend will be paid on 15 June 2012 to shareholders on the register on 11 May 2012.

People

I would like to take this opportunity to thank all of my colleagues around the world. This strong performance is testament to the dedication and commitment of the Ted Baker team. Their passion and enthusiasm are key factors in the success and continuing development of our brand.

Current Trading and Outlook

The Ted Baker brand continues to perform well in an uncertain trading environment. We are pleased by the initial positive reaction to our Spring/Summer collections and believe that we are well placed to deal with the challenges and opportunities ahead. We are excited by our planned expansion and investment in our businesses overseas, which include openings on Fifth Avenue, New York, Toronto, Canada, Tokyo, Japan, Seoul, Korea and Beijing, China.

Retail

The new financial year has started well in all our markets.

In the US, we have opened a further eight concessions in a leading department store and plan to open a further eleven concessions during the year. We will be opening a store on Fifth Avenue, New York in July. We will be opening our first store in Toronto, Canada in November.

In Europe, we have opened three concessions through a leading department store in the Netherlands and we will be opening further concessions in Eire and Spain during the year.

In the UK, we will be opening a store on the Brompton Road, London in the middle of the year.

In Asia, we have very recently opened a store in Tokyo, Japan and our first concession through a leading department store in Seoul, Korea. We will be opening a store in Beijing, China in the middle of the year and we continue to seek opportunities for further stores in Hong Kong.

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 broadly level on last year given the challenging environment faced by our Trustees. 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.

We plan to open stores in Kuala Lumpur and Abu Dhabi during the coming year with our licence partners in those territories.

Group

The Ted Baker brand continues to perform well in an uncertain trading environment and we believe 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 2012.

We remain focused on our multi-channel distribution strategy and look forward to the further expansion of the Ted Baker brand in existing and new international markets.

We intend to make our next interim management statement, covering trading since the start of the financial year, on 12 June 2012.

Robert Breare

Non-Executive Chairman

21 March 2012

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, the US, 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, the US and Hong Kong, 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 14.1% to £174.2m (2011: £152.7m). Average retail square footage rose by 6.6% over the year to 240,815 sq ft (2011: 225,828 sq ft). Total retail square footage at 28 January 2012 was 253,635 sq ft (2011: 229,026 sq ft), an increase of 10.7% on the prior year. Retail sales per square foot rose 5.7% from £648 to £685.

Sales through our e-commerce business increased by 42.2% to £9.1m (2011: £6.4m). During the period we launched a "Click and Collect" service in the UK and were pleased with the response from our customers.

The retail gross margin fell slightly to 65.2% (2011: 65.5%). Input margins have been largely maintained and the slight reduction in the gross margin was as a result of increased promotional activity in the first half of the year and a slight change in mix between full price and outlet sales.

Retail operating costs increased in line with our expectations to £81.2m (2011: £72.6m) and as a percentage of retail sales fell to 46.6% (2011: 47.6%), primarily driven by our more established markets, the UK and the US. This combined with the slight reduction in the retail gross margin resulted in an increase in retail operating contribution of 18.5% (2011: 18.0%).

Wholesale

We currently operate a wholesale business in the UK serving 15 countries across Europe and a wholesale business in the US.

Group wholesale sales increased by 18.5% to £41.4m (2011: £35.0m) and the gross margin increased to 45.1% (2011: 44.8%). 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, which contributed its first full year of trading under our own management.

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, perfume & fragrance, watches, footwear, eyewear, neckwear and childrenswear.

Licence income was up 8.1% to £6.7m (2011: £6.2m). We have seen good performances from our collections with product licence partner Debenhams, with whom we have an exclusive childrenswear collection and, B by Ted Baker, an exclusive lingerie and sleepwear collection, and our licensed footwear partner, Pentland Group. 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 20.0% to £107.4m (2011: £89.5m). Womenswear benefited from a greater proportion of the space added during the period and as a result represented 49.8% of total sales (2011: 47.7%).

Ted Baker Menswear performed well with sales increasing by 10.2% to £108.3m (2011: £98.2m). Menswear represented 50.2% of total sales in the period (2011: 52.3%).

GEOGRAPHIC PERFORMANCE

United Kingdom and Europe

Sales in our UK and Europe retail division were up 8.7% to £148.6m (2011: £136.7m). This good performance was delivered despite a subdued start to retail trading at the start of the year and the unseasonably warm weather experienced in the Autumn.

Average retail square footage rose by 2.8% over the period to 193,389 sq ft (2011: 188,035 sq ft). At 28 January 2012 total retail square footage was 201,223 sq ft (2011: 187,043 sq ft) representing an increase of 7.6%. Retail sales per square foot increased by 4.2% from £694 to £723.

During the year we opened a store in Manchester, a second store in Paris, fourteen concessions through a leading department store in Spain and Portugal and a further concession in Dublin and we were pleased with their performances during the period. During the second half of the year we relocated our stores in the Bluewater shopping centre and Bicester Outlet Village to larger units and these have performed well.

As part of an ongoing review of our store portfolio we disposed of our Langley Court and Westbourne Grove, London stores, whilst our store in the South Terminal of Gatwick was closed as a result of redevelopment plans for the terminal building. During the year we took the decision to close our concessions in Italy. At 28 January 2012 we operated 33 stores (2011: 33), 169 concessions (2011: 165) and 10 outlet stores (2011: 10).

Our e-commerce business performed well during the period with a significant increase in sales compared to last year.

Sales from our UK wholesale division increased by 15.6% to £35.5m (2011: £30.7m) reflecting a good performance from our UK wholesale business and continued growth in our wholesale export business.

US

Sales from our US retail division increased by 69.4% to $34.9m (2011: $20.6m) which, in sterling, resulted in a 62.7% increase to £21.8m (2011: £13.4m).

During the year we opened eleven concessions through a leading department store and are very pleased with their performance. Towards the end of the year we opened a further store in San Diego and an outlet store in Wrentham, near Boston, and are pleased with their performances at this early stage.

Average square footage rose by 24.4% to 42,761 sq ft (2011: 34,368 sq ft) and retail sales per square foot increased 35.1% from $595 to $804. This partly reflects an improvement in consumer confidence in this market and partly due to higher sales densities in the concessions opened during the year. As at 28 January 2012 we had 14 stores (2011: 13), 11 concessions (2011: nil) and 3 outlet stores (2011: 2).

Sales from our US wholesale business increased by 45.5% to $9.6m (2011: $6.6m) reflecting the first full year of trading and an improved performance under our own management.

Middle East, Asia and Australasia

We continue to develop the Ted Baker brand across the Middle East, Asia and Australasia working closely with our partners in those territories to ensure the visual merchandising of the stores and the training of the teams reflect the Ted Baker culture. As at 28 January 2012 we operated a total of 26 stores (2011: 23 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. As at 28 January 2012 we operated 7 stores across the Middle East (2011: 7 stores).

During the year we opened a further store in Hong Kong and, with our licence partner in the territory, a concession in Singapore. As at 28 January 2012 we operated 15 stores across Asia (2011: 13 stores).

In August, we opened our first store in Auckland, New Zealand through a joint venture with our licence partner in that territory, Flair Industries Pty Ltd, and we are pleased with its performance. As at 28 January 2012 we operated 4 stores in Australasia (2011: 3 stores).

Financial Review

Revenue and Gross Margin

Group revenue increased by 14.9% to £215.6m (2011: £187.7m), driven by a 14.1% increase in retail sales to £174.2m (2011: £152.7m) and an 18.5% increase in wholesale sales to £41.4m (2011: £35.0m).

The composite gross margin for the Group was 61.3% (2011: 61.7%). Whilst input margins were broadly maintained, this net reduction reflects a higher level of promotional activity in our retail markets in the first half of the year, a change in mix between retail and wholesale sales, with wholesale representing a greater proportion of our sales mix than in the comparative period, and a change in mix between full price and outlet sales.

Operating Expenses Pre-Exceptional Costs

Operating expenses rose by 14.3% to £112.0m (2011: £97.9m). Excluding the employee performance related bonus of £3.1m (2011: £2.4m), operating expenses rose by 14.0%. Distribution costs increased in line with our expectations to £82.4m (2011: £73.7m) and as a percentage of sales fell to 38.2% (2011: 39.3%), this was primarily driven by our more established markets, the UK and the US.

Administration expenses increased by 22.2% to £29.6m (2011: £24.3m). Excluding the employee performance related bonus, administrative expenses rose by 21.4%, 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.

The Group has a net impairment credit of £0.4m (2011: nil). This was the result of the write-back of a previous impairment loss in relation to the carrying value of retail assets in Eire (£0.8m), offset by impairment losses in respect of the carrying value of other retail assets (£0.4m).

Exceptional costs

The exceptional costs, which include both distribution costs and administration expenses, incurred during the year of £2.8m (2011: nil) are in respect of rent for stores that will 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 11.7% to £27.1m (2011: £24.2m) and profit before tax increased by 0.1% to £24.3m (2011: £24.2m). This result was after the payment of an employee performance related bonus of £3.1m (2011: £2.4m), Bonus payments in both years were the result of exceeding internal targets in the financial year.

Finance Income and Expenses

Net interest payable during the year was £201,000 (2011: £30,000). This increase reflects higher Group borrowing compared to the prior year.

The foreign exchange gain during the year of £38,000 (2011: loss of £48,000) was due to the retranslation of monetary assets and liabilities denominated in foreign currencies.

Taxation

The Group tax charge for the year was £6.7m (2011: £6.9m), an effective tax rate of 27.6% (2011: 28.7%). This reduction reflects the fall in the UK corporation tax rate from 1 April 2011. The Budget on 23 March 2011 announced that the UK corporation tax rate will fall from 28.0% to 23.0% over a four year period. We expect to see a future reduction in our effective tax rate in line with these changes although the rate will be impacted where future profits arise in overseas jurisdictions with higher tax rates than the UK.

Cash Flow

Net cash generated from operating activities was £11.5m (2011: £18.1m). The decrease on the prior year is principally due to an increase in working capital.

Total working capital as per the Group balance sheet, which comprises inventories, trade and other receivables and trade and other payables increased by £12.3m to £47.2m (2011: £34.9m). The increase in inventories was in respect of the anticipated growth of the business and a continued recent trend in respect of our Spring / Summer collections being receipted into the business earlier. This, combined with the timing of the Chinese New Year, which fell before the end of the Group's financial year, resulted in earlier payment for inventory than the prior year.

Capital expenditure of £15.0m (2011: £10.0m) 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 £3.7m (2011: £1.0m) of expenditure which relates to stores that are due to open in 2012.

Proceeds from the sale of property, plant and equipment of £0.5m (2011: nil) relates to payments received on the disposal of our Langley Court and Westbourne Grove, London stores.

Shareholder Return

Basic earnings per share increased by 1.7% to 42.2p (2011: 41.5p). Adjusted earnings per share, which exclude exceptional costs of £2.8m, increased by 17.8% to 48.9p (2011: 41.5p).

The proposed final dividend of 16.25p per share will make a total for the year of 23.4p per share (2011: 20.6p per share), an increase of 13.6% on the previous year.

Free cash flow per share, which is calculated using the net cash generated from operating activities, was 26.7p (2011: 41.8p), this reduction was due to the increase in working capital.

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 2013.

Borrowing Facilities

The Group has a three year committed borrowing facility of £40.0m (2011: £20.0m), 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 will be used to the extent necessary to fund capital expenditure to support the Group's growth strategy.

The facilities contain financial covenants which are believed to be appropriate in the current economic climate and 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, assess 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 28 January 2012

Group Statement of Comprehensive Income

For the 52 weeks ended 28 January 2012

Group Statement of Changes in Equity

For the 52 weeks ended 28 January 2012

Group Statement of Changes in Equity

For the 52 weeks ended 29 January 2011

Company Statement of Changes in Equity

For the 52 weeks ended 28 January 2012

For the 52 weeks ended 29 January 2011

Group and Company Balance Sheet

At 28 January 2012

These financial statements were approved by the Board of Directors on 21 March 2012 and were signed on its behalf by:

L D Page

Director

Group and Company Cash Flow Statement

For the 52 weeks ended 28 January 2012

Notes to the Financial Statements

For the 52 weeks ended 28 January 2012

1. Basis of preparation

EU law (IAS Regulation EC 1606/2002) requires that the Group financial statements, for the 52 weeks ended 28 January 2012, 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 28 January 2012.

The financial information set out above does not constitute the Group's statutory accounts for the 52 weeks ended 28 January 2012 or 52 weeks ended 29 January 2011. The annual financial information presented in this annual results announcement for the 52 weeks ended 28 January 2012 is based on, and is consistent with, that in the Group's audited financial statements for the 52 weeks ended 28 January 2012, and those financial statements will be delivered during the second week of May 2012. 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 29 January 2011 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 4 to 6. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in the Chairman's Statement on pages 2 and 3. 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 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

·; One-off bad debt provision which is considered unusual and has materially impacted the results

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 29 January 2011.

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

Revisions to IFRS not applicable in 2011

Standards and interpretations issued by the IASB are only applicable if endorsed by the EU. The following may be applicable in the future:

·; IFRS 9, Financial Instruments, will simplify the classification of financial assets for measurement purposes, but is not anticipated to have a significant impact on the financial statements. If endorsed, this will be effective for 2015.

·; Amendments to IAS 19, Employee Benefits, will require the financing on post-retirement benefits to be calculated on the net surplus or deficit using an 'AA' corporate bond rate. This is not going to impact the Group as there is currently no defined benefit obligation. This will be effective for 2013.

·; IFRS 11, Joint Arrangements, may result in certain entities currently classified as joint ventures being classified as joint operations. This would result in the Group's share of the individual assets and liabilities of these entities being included in the financial statements rather than the equity method accounting adopted under the requirements of IAS 31, Interests in Joint Ventures. This will not affect the Group's net assets or profit for the period. This will be effective for 2013.

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.

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-segment sales of £20,348,000 (2011: £14,596,000).

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 £2,814,000 (2011: £nil) are in respect of rent for stores that will not commence trading until 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.

* See note 8. Property, plant and equipment for further information

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 28% to 26% with effect from 1 April 2011. There are further proposed reductions of 1% per annum for the next 3 years such that the headline rate will decrease to 23% by 1 April 2014.

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 25%.

Had the further tax rate changes been substantively enacted before the balance sheet date, it would have had the effect of reducing the net deferred tax liability to UK operations by a further £114,000.

6. Dividends per share

A final dividend in respect of 2012 of 16.25p per share, amounting to a dividend payable of £6,766,650, is to be proposed at the Annual General Meeting on 12 June 2012.

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 £2,814,000 (2011: £nil).

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 £1,031,000 (2011: £506,000) whilst additions into this category were £3,732,000 (2011: £1,031,000).

The net impairment credit of £352,000 relates to the reversal of an impairment charge of £733,000 incurred during the 52 weeks ended 30 January 2010 in relation to the carrying value of retail assets in Eire and offset by an impairment charge relating to retail assets in the year of £381,000.

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 40 per cent of the voting shares of the Company.

At the 28 January 2012, the main trading company owed the parent company £30,053,000 (2011: £24,710,000). The main trading company was owed £38,987,000 (2011: £23,313,000) 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 28 January 2012, the joint venture owed £407,000 to the main trading company (2011: £286,000). In the period, the value of sales made to the joint venture by the Group was £726,000 (2011: £565,000).

The Group considers the Board of executive directors as key management. Further details are provided in the Remuneration Report in the Group's financial statements.

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.