The fashion designer plans to increase full-price sales mix by 15% in the second half this year, as well as opening ten new stores and increasing sustainable cotton use to at least 75%.
The group also targets rent savings of at least 15%, with each renegotiation with landlords to deliver at least 50% reduction in base rent.
It will also complete the launch of its new e-commerce platform, which delivered 4% sales growth in the first quarter thanks to a less heavy promotional stance compared to last year, which in turn helped margins.
In the 12 weeks to 24 April, group sales slid by a fifth due to global Coronavirus (COVID-19) restrictions, with retail stores down 41% and wholesale and licence down 22%.
The first quarter ended with £29mln in the bank with available facilities of £133mln.
In the 53 weeks to 30 January, group revenue tumbled 44% to £352mln while loss before tax widened 39% to £107mln. A dividend was not declared.
Analysts at Hargreaves Lansdown said the current view is “murky at best” as Ted Baker needs to find a way to sustainably improve its online business, while getting enough footfall through the doors is not going to be an easy task.
“We’re concerned that job’s going to be made even more difficult by the immense reduction in capital expenditure, meaning only essential work is being done on the store estate. Under-investing helps with cash preservation in the short-term, but the longer reaching effects could be substantial,” they noted.
“It’s not all bad. Ted Baker has done well to generate free cash flow, and the ideas underpinning the new strategy make sense. If the plans come off, those investors that have held their nerve could be rewarded.”
Shares rose 2% to 170.34p on Monday morning.
–Adds analyst comment, shares–