Store closures hit sales at Joules but profits ahead of expectations

Forced store closures led to a 15.3% drop in sales at Joules in the 26 weeks to 29 November but profits were ahead of forecast.

The premium fashion and lifestyle brand achieved sales of £94.5m in the six-month period with profit before tax before exceptional items of £3.7m, down from £8.4m in the corresponding period in the prior year. Joules said this was a better than expected performance.

Gross digital sales increased by 55% during the period, including sales on the Friends of Joules third-party brands site, as shoppers turned to online in the face of forced store closures. Joules' store were obliged to close for 10 of the 26 weeks.

Active customers increased by nearly 160,000 during the period and is now nearly 1.6m, while the company has a net cash position of £15.6m, which is again better than expected. 

With stores closed again under lockdown 3 the company has reported strong e-commerce sales for the seven weeks to 3 January 2021, which it said had more than offset impact of store closures through the Christmas trading period with own retail revenue up by 0.3%.

Joules CEO Nick Jones said: “We are pleased with the Group’s performance during the first half of the FY21 financial year with strong growth in active customers and profits ahead of the Board's expectations. This performance, underpinned by very strong sales growth through our digital channels, was achieved despite challenging trading conditions and extended periods of store closures. 

“The Group's progress continues to reflect the strength of our flexible and digital-led model, growing customer base and strong brand as well as the talent and dedication of our teams. I would like to take this opportunity to extend my sincere thanks to all Joules colleagues for their hard work as well as to our customers and partners for their continued support. 

“Whilst the retail sector will continue to face near and medium-term challenges as a result of the pandemic, I remain confident that Joules - underpinned by the strength of our brand as well as the Group's flexible and scalable platform - remains well positioned to achieve its strategic objectives to grow as a leading lifestyle brand and digital marketplace."