High Street

Joules reveals ‘contingency plan’ for a hard Brexit amid strong H1 results

Fashion retailer Joules’ group revenue has increased by 17.6% to £113.1m for the first half 2019 financial year, covering the 26-week period to 25 November 2018.

However, the retailer’s executive board anticipates that trading conditions in the UK “will remain challenging over the near term”, with continued “macroeconomic uncertainty, rapidly changing consumer shopping behaviours and a highly competitive environment”.

Contingency plans have been put in place by Joules to mitigate the expected disruption that could arise in the event of a ‘hard Brexit’. These plans include establishing an EU based third party distribution facility, scheduling earlier inbound product deliveries for its S/S 2019 ranges, preparation for expected increased administrative activities and hedging US dollar requirements more than 12 months in advance.

It comes amid “rapid growth” in its international business, which now represents approximately 16% of group revenue, compared with 11.3% during the same period last year. E-commerce also performed well during the first half and now represents nearly 50% of all retail sales.

Retail and wholesale revenue figures for the period were impacted by the transition of some UK wholesale accounts to a retail concession model, which group says will “provides greater future trading flexibility”.

CEO Colin Porter said: “I am delighted to update on what has been another period of strong performance for Joules despite challenging trading conditions.  This performance, which is ahead of our initial expectations for the Period, is testament to the strength of the Joules brand, the engagement of our loyal customers with our product collections, and our fantastic teams.

“In the UK, our ‘total retail’ cross-channel model, underpinned by investment in infrastructure, has proven to be well suited to today’s rapidly changing consumer shopping behaviours.  In addition, our international wholesale business continues to make excellent progress by both increasing sales to existing accounts and developing new accounts.”

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