British lifestyle brand Joules has said it is taking ”prudent actions” after witnessing a decline in in-store footfall and revenue since the outbreak of Covid-19 in the UK.
In the weeks following the announcement of the group’s Interim results on 21 January 2020, the group said it’s key retail channels performed in line with expectations.
However, since the coronavirus pandemic in the UK, Joules said it has experienced a decline in retail footfall and revenue, which has significantly accelerated over recent days. The group’s ecommerce channel has also been impacted, albeit to a lesser extent, as consumers have shown increasing caution with their disposable income. The retailer said these trends are also likely to impact the group’s sales through its concession and wholesale trading partners in the UK and internationally.
The board expects Covid-19 to continue to have an impact on its business and the retail sector over the coming months. However, given the level of continued uncertainty, it said it is not able to provide financial guidance at this stage.
”The board is taking prudent actions to manage the near term challenges whilst ensuring the business remains well positioned to deliver its long term growth plans”, a company statement said. ”These actions include removing cost and non-critical capex from the business. Furthermore, the board has decided to cancel the proposed interim dividend, saving £0.7m of cash.
”The group currently has £16m cash headroom, a strong relationship with its bank, Barclays, and a supportive founder and major shareholder, Tom Joule.
“The board continues to plan for multiple scenarios and explore various ways to mitigate the impact of reduced demand for a potentially extended period of time. The board welcomes the measures that the UK government has thus far announced to support retailers and impacted employees across the sector. However, we strongly echo the position of the British Retail Consortium (BRC) and other senior retail leaders that more urgent action is needed to provide support to those working in retail during these challenging and uncertain times.”
Nick Jones, CEO of Joules, said: “The challenges that all retailers are currently facing are unprecedented in modern times. Our immediate and over-riding objective is to ensure the wellbeing and protection of our colleagues and our customers. Our teams continue to demonstrate a flexible, can-do attitude during this testing time, and I would like to thank my colleagues across the world for their continued commitment and positivity.
“While the group’s near-term profitability will be impacted by the sector-wide effects of Covid-19, the board is remaining focused on protecting long-term value for its stakeholders and managing the near-term pressures on the business.
“We have an outstanding, unique brand and a fantastic team. I am very confident that Joules will successfully emerge from this very difficult period in a position to continue to deliver its exciting long-term growth plans.”