- Joules shares plummeted 35% following its trading update.
- The company stated retail sales fell 8% year-on-year.
- The group expects to make a significant loss in the first half of the year.
Joules provided its trading and business update for the end of the financial year, which saw retail sales fall and a weaker than expected outlook.
Following the report, Joules’ share price descended 35%.
The company stated trading had softened materially due to extremely warm and dry weather adversely affecting full-price sales of core categories such as outerwear, rainwear, knitwear, and wellies.
I think that can be expected for the summer.
Furthermore, retail sales consequently fell 8% year on year, and retail margins declined by 6% year-on-year. This reflects the shortfall of full-price sales and the level of discounting that has been required to engage customers.
It is not all bad news despite what its shares suggest.
Wholesale trading for the Joules brand has achieved 10% growth year-on-year despite delays experienced in US ports. Meanwhile, active customer numbers now stand at over 2 million, which is a 10% increase from last year.
As a result, of its weaker performance, Joules expects to make a significant loss in the first half of the year and deliver a full-year loss, considerably below market expectations.
The share price of Joules has declined almost 80% in 2022, and it is clear to see why. After a dismal trading update today, its consumer data also shows disappointing results.
The group had an excellent year in 2021, with monthly traffic soaring to highs of almost 1.5 million. However, the company has since seen a significant decline.
Meanwhile, interest from Google Trends tells a similar story. The company is yet to reach the levels shown just one year prior.
Despite the company making “good progress with its initiatives to simplify the business,” it is difficult to be bullish for Joules.