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Joules says eCommerce represents almost half of retail sales

Joules announced that almost 50% of its total retail sales are coming from eCommerce, as part of a pre-close trading update this morning (5 December) that showed a positive sales performance for the first half of its financial year.

In the 26-week period to 25 November 2018, group revenue increased by 17.6% to £113.1 million, driven by strong growth in its international operations which it indicated now represent approximately 16% of overall revenue.

Retail sales were up by 21.2% to £79.9 million, with wholesale up 8% to £32.5 million, aided by sales increases in its target foreign markets of the US and Germany. However, Joules said retail and wholesale revenue was impacted by the transition of some UK wholesale accounts to a retail concession model, which the company believes “provides greater future trading flexibility”.

The board said it now anticipates to announce a level of underlying profit before tax that is slightly ahead of initial expectations for the period, although it expects trading conditions in the UK will remain challenging over the near term. This better-than-expected performance is unusual for a UK retailer in the current challenging climate, and highlights Joules as an industry out-performer.

Joules is putting contingency plans in place for the UK’s withdrawal from the European Union (EU) at the end of March “to mitigate the expected disruption that could arise in the event of a hard Brexit”. An EU-based third-party distribution facility has been organised, while the company is also scheduling earlier inbound product deliveries for its spring-summer 2019 ranges.

The retailer said it is also preparing for increased administrative activity, and it is hedging US dollar requirements more than 12 months forward.

Colin Porter, Joules CEO, said the performance was ahead of the company’s initial expectations for the period.

“In the UK, our 'total retail' cross-channel model, underpinned by investment in infrastructure, has proven to be well suited to today's rapidly changing consumer shopping behaviours,” he explained.

“In addition, our international wholesale business continues to make excellent progress by both increasing sales to existing accounts and developing new accounts.”

The group will announce its interim results for the 26-week period to 25 November 2018 on 23 January 2019.

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