Joules has announced that its CEO, Nick Jones, will step down from his role during the first half of the group’s next financial year following three years at the helm, as the group warned of subdued trading amid challenging market conditions.
The group said that since joining the business in 2019, Jones has helped it to navigate through an “unprecedented” trading environment, particularly in light of the pandemic. It will begin the search for his successor “immediately” to “ensure a smooth transition of responsibilities”.
The announcement coincided with a trading update from the group, who said it has continued to deliver “strong revenue growth”, with a 20% rise in revenue for the 13 weeks to 1 May 2022.
However, it warned that market conditions had “become more challenging” during and after the Easter period as consumer confidence was hit by the rising cost of living.
It said it has “not been immune” to the sector-wide pressures caused by this, which have led the group’s profit performance to “fall below management’s expectations” in several areas.
It warned of “significantly impacted” margins through its own channels, for example, amid a competitive environment that has been “increasingly promotional”, with customer participation highly dependent on promotional activity and reduced demand for full price items.
In addition, it warned that consumer demand for home and garden categories has been “subdued”, particularly online, with Garden trading performing significantly below expectations over its peak sales period in March and April.
It also reported weaker third party sales across a number of key UK accounts, while US wholesale sales have remained below expectations due to stock delays and lower demand.
Looking ahead, the group said it aims to focus on accelerating plans to improve profitability and cash generation through cost restraint and the clearance of aged stock.
Given the trading challenges outlined in its latest update, which are anticipated to continue during the first half of FY23, the board said it is “cautious” about its near-term outlook, but “remains confident” in the long-term prospects of the business.
Nick Jones, CEO of Joules, said: “Building on the strategic progress made so far, over the coming months we will continue to deliver against the clear priorities that the Board and I believe will create a strong foundation for Joules to achieve its significant long-term potential, as well as helping the business to navigate the current challenging trading environment.
“Joules is a fantastic brand with great people, loyal customers, and a differentiated product offering. Underpinned by the strategic actions we are taking to optimise the business, Joules will emerge stronger and better positioned to achieve long-term, profitable growth.”
Ian Filby, chairman of Joules, added: “On behalf of the board and everyone at Joules, I would like to thank Nick for his significant efforts over the last three years. He has led the business with integrity, care, and energy during what has been a particularly challenging period for the retail sector, including during the Covid-19 pandemic.
“Under Nick’s leadership Joules has made good progress against its strategy to develop as a digital-led lifestyle group. More recently, he has led the business in implementing a number of important strategic initiatives that will underpin the Group’s future over the coming years. The board will now begin a search process for Nick’s successor and will share an update in due course.”