Joules suffers from decreasing store footfall and revenue due to Coronavirus
Fashion and lifestyle retailer, Joules announced on Thursday that the Coronavirus outbreak in the UK has led to a significant decline in store footfall and revenue.
The company said that in the weeks since its half-year results were released on January 21, its key retail channels have performed “in line with expectations" but footfall has dropped significantly recently as the Government encouraged people to stay in their homes.
A company statement said: "The board is taking prudent actions to manage the near term challenges whilst ensuring the business remains well positioned to deliver its long term growth plans. These actions include removing cost and non-critical capex from the business. Furthermore, the board has decided to cancel the proposed interim dividend, saving £0.7m of cash."
Joules continued to say that decreasing footfall and revenue "has significantly accelerated over recent days." The firm’s e-commerce channel has also been affected, by a lesser extent, "as consumers have shown increasing caution with their disposable income."
A positive note highlighted by the brand said it has “demonstrated its strength, with consumer awareness at its highest-ever level of 46.4%, up 4.6ppt on the prior year, and Joules' brand health score also reaching record levels as measured by YouGov's monthly survey."
With cashflow being a major concern for retailers during this crisis, the company said it has a £16 million “cash headroom, a strong relationship with its bank, Barclays, and a supportive founder and major shareholder, Tom Joule."
It’s continuing “to plan for multiple scenarios and explore various ways to mitigate the impact of reduced demand for a potentially extended period of time."
Joules further added that with the government increasingly introducing new measures to contain the virus, "more urgent action is needed to provide support to those working in retail during these challenging and uncertain times."
CEO of Joules, Nick Jones continued: "The challenges that all retailers are currently facing are unprecedented in modern times. Our immediate and over-riding objective is to ensure the well being and protection of our colleagues and our customers. Our teams continue to demonstrate a flexible, can-do attitude during this testing time."
"While the group's near-term profitability will be impacted by the sector-wide effects of Covid-19, the board is remaining focused on protecting long-term value for its stakeholders and managing the near-term pressures on the business. We have an outstanding, unique brand and a fantastic team. I am very confident that Joules will successfully emerge from this very difficult period in a position to continue to deliver its exciting long-term growth plans."