Joules says it plans to open four new stores before Christmas after its sales recovered from a “challenging” September to grow across sales channels.
The mid-market fashion and lifestyle retailer says customers are responding well to its total retail model that brings online and store sales together.
In a pre-close trading statement, it said revenues would come in at £111.6m, 1.3% ahead in the 26 weeks to November 24 – when adjusted to include the Black Friday period this year as well as last. Retail sales rose by 3.1% to £79.9m. Wholesale fell by 3.8% to £30.8m, which Joules said reflected both the movement of some larger accounts to become retail concessions last year, and the “continued challenging UK trading environment”.
When this year’s Black Friday figures were discounted, both group sales (-1.4%), and wholesale (-5.1%) were down while retail sales growth was flat (0%).
Joules, which is ranked Top150 in IRUK Top500 research, said that a challenging September had been followed by 9% growth over the subsequent two months, thanks to “positive trading momentum” across its ecommerce and store sales.
International sales grew over the half-year to account for about 17% of group revenue, and in September the retailer launched Friends of Joules: a curated digital marketplace where third-party sellers can sell their wares on the Joules website. The move, said Joules, had met with a good customer response.
“Joules has delivered further profitable growth during the period despite the continued challenging trading environment,” said new Joules chief executive Nick Jones. “Tis performance again reflects the appeal of the brand, the flexibility of our ‘total retail’ model and the hard work and skill of our team who have not only helped deliver growth in this tougher climate but have also launched innovative new initiatives like Friends of Joules that create future growth opportunities.”
Joules says it is confident about its Christmas sales and predicts second-half growth.
“Since joining the business in September, I have been struck by the exceptional strength of the Joules brand as well as its clear potential for growth across channels, markets and product categories,” said Jones. “We continue to invest in our proposition to meet changing customer expectations in a scalable and profitable way and, with positive momentum across both digital and physical channels, we are well placed as we enter the important Christmas trading period.”
Emily Salter, retail analyst at data and analytics business GlobalData, said Joules’ figures were sobering. “This is a significant slowdown considering that group revenue grew by an impressive 17.2% in FY2018/19, evidencing the huge impact of weak consumer confidence stemming from continued Brexit uncertainty. Despite offering a not unusual 20% discount over the Black Friday period, this significantly boosted spend as consumers held back purchasing in the lead up to the event.”
She added: “Joules will open four stores before Christmas and has launched a popular advert featuring the iconic duo Wallace and Gromit - an ideal fit for the brand’s image – both of which should help boost sales. Joules usually performs well over the festive period as it is well suited to gifting and with double digit growth standards to lie up to, this will be a test of the longevity of the brand’s appeal.”
Image courtesy of Joules