Joules confident but cautious after 'better than expected' Q1

Fashion brand Joules has today (23 September) reported a better than expected performance for the first quarter of the financial year, as the business reopened stores after the coronavirus-enforced lockdown period.

Group revenue for the 13 weeks to 30 August was £39.6 million, driven by a 63% year-on-year hike in the group's own eCommerce channels. However, overall group revenue was down by 18% compared to the same period in 2019, reflecting the impact of Joules' stores, and those of many of its wholesale partners, temporarily closing due to Covid-19.

Breaking down the sales by division, overall retail revenue dropped by 5% – although retail sales through the group's own retail channels were up by 1.5%, which it partly attributed to promotional activity.

Overall eCommerce revenue, which includes sales made on third-party websites, increased by 45% against the prior year. The Friends of Joules marketplace also performed well, according to today’s statement, although no specific sales figures for the platform were reported.

"We are encouraged by the group's performance in the first quarter of the financial year with sales ahead of our expectations,” said Joules CEO, Nick Jones.

“This is testament to the flexibility of the Joules model and the increasing strength, relevance and awareness of the Joules brand.”

He added: “We have been pleased with the performance of our stores since re-opening with higher levels of conversion when compared to pre-lockdown and steadily improving footfall trends.

“As with all consumer-facing businesses we face challenging trading conditions and unprecedented levels of uncertainty over the coming months and into the peak Christmas trading season. Against this backdrop we remain cautious on the future trading outlook and will continue to tightly manage costs and conserve cash.”

Jones also said Joules remained well positioned to adapt to changing consumer behaviour.

Wholesale sales dropped by 59% year-on-year during the first quarter, and the business had a net cash position of £8.5 million at the end of the period, which was up £4 million on the company’s year-end position.

Joules also said group inventory totalled £38 million, which was 16% lower than the prior year “reflecting good sell through of spring/summer 2020 ranges and a more cautious buy for the early phases of autumn/winter 2020 stock”.