Outdoor fashion and lifestyle retailer Joules has appointed ‘Big Four’ accounting firm KPMG to improve its cash position in the face of turbulent economic conditions due to the cost of living crisis. According to reports from The Sunday Times, Joules has called in advisors from KPMG’s debt advisory practice to explore options to shore up its cash position, with raising fresh capital said to be among one of the options available.
In response to the speculation, Joules released a statement confirming the appointment of KPMG and revealed that as of 29 May, it has net debt of £21.4m, giving £11.3m headroom within its banking facilities which it said was “in line with the board’s expectations”.
It stated: “As set out in our May trading update, the group continues to focus on improving profitability, cash generation and liquidity headroom. The group confirms it has appointed KPMG debt advisory to assist in this process. As at 29 May, the group had net debt of £21.4m, giving £11.3m headroom within its banking facilities, in line with the board’s expectations.
“Whilst the group continues to manage its cash resources carefully over its seasonal borrowing peak, it expects to have sufficient liquidity to manage its working capital requirements over this time.”
It added: “The group is making good progress against previously announced key initiatives aimed at simplifying the business and optimising the cost base to improve long-term profitability.
“This includes implementing significant changes to its wholesale operations to focus on fewer, profitable wholesale accounts and improving and simplifying the group’s end-to-end product process to reduce costs and shorten lead times.”
Earlier this year, Joules revealed 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.