Joules multichannel strategy pays off

Joules continued its emphasis on multichannel and international shopping in its latest half-year results.

The company turned over £81.4 million in the 26 weeks to November 29, 16.2 per cent more than at the same time last year, while pre-tax profits of £6.9m were 81.6 per cent up on the £3.8m it reported last time. Underlying pre-tax profits, before the one-off costs related to its stockmarket flotation, came in at £7.5m, 19.9 per cent up on last time.

Ecommerce sales grew by 30.3 per cent over the half-year, outpacing stores, where sales grew by 11.2 per cent. The retailer said the ecommerce channel benefited from higher customer numbers, added in the preceding period, which helped to drive higher numbers of website visitors, as well as improved stock availability. Conversion improved following the launch of a content-rich, mobile optimised website in September 2015.

Wholesale revenues also grew, by 17.1 per cent; Joules said this reflected the growing appeal of its brand both in the UK and in international markets. As a wholesale brand, it sells via John Lewis and via Next’s Label business for third-party brands.

International sales grew by 39.3 per cent to account for 10.6 per cent of group revenue. Wholesale was important in reaching its target markets of North America and Germany. In the US it sells in leading department stores including Dillards and Nordstrom. Distribution in that market is now set to be taken in-house and managed by its New York-based sales and marketing team.

Its active customer numbers grew to 922,000 over the period, 30 per cent more than at the same time last year. Its total customer database stands at 2.3m. A chief customer officer, Lysa Hardy, was appointed in September 2016 with a mission to increase customer value across all channels.

“Joules has continued to perform well during the first half of the financial year with strong growth delivered across the brand’s distribution channels and target markets,” said chief executive Colin Porter. “This significant progress reflects the quality and design of our products and the growing demand for the Joules brand, both in the UK and internationally.

In common with many retailers, Joules sees cost prices rising and pressure on profit margins. It says its foreign currency hedging programme, long-term supplier partnerships, and its strong brand and differentiated product offer, along with a loyal and growing customer base will help it to overcome this.