Clothing & Shoes

Joules swings to £2m loss in full-year results

Joules has announced that it swung to a pre-tax loss of £2m in its full-year of trading, down from the £12.9m profit it reported the year prior.

Group revenue also fell by 12.5% to £190.8m in the period, down from the £218m reported the year before.

The retailer noted that results were “adversely impacted” by Covid-19, estimating that the revenue impact of the crisis in the final quarter was around £31m. In addition, the group said lower revenue was also driven by previously reported e-commerce stock availability issues over the Christmas trading period.

While store revenue fell by 21.4% for the total year, the first nine months of the period, before the pandemic, saw store sales down by 8%, which “reflected structural industry trends and reduced promotional activity”.

Wholesale revenue also fell by 25.3%, with the final quarter experiencing a reduction of 75% as wholesale customers closed their operations across the world.

Nonetheless, e-commerce “performed well”, with Joules’  e-commerce channel revenue up by 11% for the year. For the first nine months of the period, e-commerce represented nearly 51% of retail sales, though this rose to 57% by the end of its financial year. 

The group also said it “remains confident as ever” in its long-term prospects and potential, citing the investments it has made in its infrastructure to support its operating model.

Nick Jones, CEO of Joules, said: “We were quick to bolster our liquidity position, preserve cash and focus our trading online, and we are very encouraged by the more than 70% growth in e-commerce demand since the start of the new financial year as well as the performance of our stores since reopening.  

“Whilst the group’s financial results for FY20 were impacted by challenging external trading conditions in the UK throughout the year; the stock availability issue that, as previously reported, impacted our e-commerce sales over the Christmas trading period; as well as material Covid-19-related disruption during the final quarter, I am very pleased with the continued progress we have made against our long-term strategic goals.” 

He added: “Whilst the retail sector will continue to face challenging trading conditions over the coming months, I believe that Joules is very well positioned to navigate both the existing and potential further CovidD-19-related challenges and continue to invest in targeted growth opportunities. 

“The Joules brand’s awareness and health metrics have never been stronger, and I firmly believe that, underpinned by our strong brand purpose, Joules is more relevant than ever before.”

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