Joules swings to profit thanks to online sales boost
The fashion chain said online sales now account for more than three-quarters of all retail revenues.
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Your support makes all the difference.Fashion chain Joules has returned to annual profit as it rode out the lockdown disruption thanks to surging online sales.
The Leicestershire-based group – famous for its posh wellies – saw online sales race 48% ahead to £122 million in the year to May 30 and now account for more than three-quarters (77%) of all retail revenues.
This helped offset a hit to sales through stores and public events, such as country shows, which plunged from £63.2 million to £36.6 million as lockdowns forced the closure of these channels for much of the year.
Store sales tumbled 41%, while revenues from shows dropped by 59%.
Despite this, the results showed Joules bounced back with full-year pre-tax profits of £2 million, against losses of £24.8 million the previous year.
Overall, revenues edged 4.3% higher to £199 million, boosted also by its recent takeover of The Garden Trading Company.
Joules snapped up the home and garden product business for £12.5 million in February to expand its garden retail operations.
Garden Trading has been a leading seller on its Friends Of Joules online marketplace since it was launched in 2019.
The firm also hailed a strong performance from the marketplace, which more than doubled revenues to £5.1 million.
Nick Jones, chief executive of Joules, said: “As we move into the new financial year, the continued success and growth of Friends Of Joules and our strengthened position in the home, garden and outdoor sector means that the group now offers significantly more products and categories than ever before.”
But Joules said it faced higher shipping costs due to disruption in global freight markets, and duty and transport price hikes after Brexit which knocked its profit margins and wholesale revenues in European markets.
It said the hit from Brexit stood at between £800,000 and £1 million in the year.
“After several months of trading under the new arrangements, the logistics challenges are starting to normalise, but the increased costs are anticipated to only partly revert to historic levels,” Joules said.
Shares in Joules fell 4% as the group said it would hold off from resuming shareholder dividend payouts due to challenges over the year and uncertainty facing consumer sectors in the pandemic.
Joules was founded in 1989 when Tom Joule started selling clothing on a stand at a country show in Leicestershire
It now boasts 1.7 million customers and has 133 stores across the UK.