The Ted Baker (LSE: TED) share price has extended its recent downturn in Monday business. The retailer was last dealing 4% lower from last week at 160p per share after the release of fresh trading numbers.

Ted Baker’s share price has fallen by a fifth over the past month. This comes as fears that the lifting of Covid-19 restrictions could be delayed in the company’s core UK marketplace have grown. The small cap sources around 60% of revenues from its home territory.

Still, the Ted Baker share price is up 25% higher on a 12-month basis. Should I buy this UK retail share following today’s dip?

Ted Baker’s losses widen

In full-year financials, Ted Baker announced that revenues tanked 44.2% in the 12 months to January, to £352m. As a consequence, the fashion giant swung to an underlying pre-tax loss of £59.2m. It had punched a £4.8m profit back in financial 2020.

On a statutory basis losses before tax ballooned to £107.7m from £77.6m a year earlier.

Ted Baker’s sharp sales reversal reflects its high dependence upon a large store network. Naturally footfall across its bricks-and-mortar assets suffered considerably during the 12 months as Covid-19 lockdowns came into effect. This caused total sales across its retail division (stores, concessions, and online) to drop 42.2% year-on-year in financial 2021, to £254.3m. Revenues generated through e-commerce rose 22% to £144.9m.

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Meanwhile turnover across Ted Baker’s wholesale and licensing arms tumbled 50.9% and 34.5% respectively in financial 2021. These clocked in at £85.3m and £12.4m.

Tough trading continues

News that the retailer continues to suffer extreme revenues stress hasn’t helped the Ted Baker share price on Monday, either. Coronavirus restrictions in the UK, mainland Europe, and Canada have all taken a fresh bite out of the retailer’s revenues in recent months.

Sales were down a further 19.9% during the three months to April, the company said. At the retail division, store sales and online sales were down 40.7% and up 4.5% respectively. Meanwhile wholesale and licensing revenues were 22.4% lower.

Time to buy Ted Baker?

I’m not surprised that Ted Baker’s share price is slumping again following these fresh financials. Personally speaking, it’s not just the threat posed by the ongoing Covid-19 crisis which is making me avoid the UK retail share. I’m also discouraged by the company’s timid e-commerce proposition.

As analyst Sophie Lund-Yates of Hargreaves Lansdown notes: “digital momentum looks to be dissipating” as lockdowns unravel. She adds that “Ted Baker needs to find a way to sustainably improve its online business, or it won’t bode well for trading patterns in the post-pandemic, digital-centric world”.

There’s no doubt that Ted Baker still has great brand power. And this could help sales recover strongly during the economic upturn and consequent improvement in consumer spending. But the business also faces severe competitive pressures that could derail any comeback. I’d much rather buy other UK shares for my investment portfolio today.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Hargreaves Lansdown. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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