Warm Weather Hits Sales of Outerwear, Rainwear, Knitwear, and Wellies
- Joules expects significant FY loss due to weak trading
- Warm and dry summer weather impacted sales of core categories
- Retail sales fell by 8% YoY in the first 11 weeks of FY
- Wholesale trading saw a 10% growth YoY despite US port delays
- Garden Trading wholesale also impacted by home and garden market slowdown
- Retail margins down 6% YoY due to discounting
- Partial recovery expected with Autumn/Winter collections
- Positive discussions with Next regarding Total Platform services and potential equity investment
- No certainty of agreement with Next
- Board expects significant loss in first half, improved performance in second half
Joules has warned that it expects to deliver a significant loss in its financial year results due to weak trading, partly attributed to the warm and dry summer weather which negatively impacted sales of its core categories such as outerwear, rainwear, knitwear, and wellies. The cost-of-living crisis also contributed to subdued consumer demand. Retail sales fell by 8% year-on-year in the first 11 weeks of the current financial year, while wholesale trading saw a 10% growth year-on-year despite US port delays. Garden Trading wholesale was also affected by the wider slowdown in the home and garden market. Retail margins dropped around 6% year-on-year due to increased discounting. However, the company expects partial recovery with Autumn/Winter collections. Joules is having positive discussions with Next about adopting its Total Platform services and potential equity investment, but there’s no certainty of an agreement. The board anticipates a significant loss in the first half followed by improved performance in the second half as business simplification benefits are realized.
Factuality Level: 8
Factuality Justification: The article provides accurate information about Joules’ financial performance, including specific numbers and reasons for the expected loss, such as inflation, weather impact on sales, and consumer demand issues. It also mentions ongoing discussions with Next regarding potential partnerships.
Noise Level: 3
Noise Justification: The article provides relevant information about Joules’ financial performance and factors affecting its sales, such as inflation, weather conditions, and consumer demand. It also mentions ongoing discussions with Next regarding potential adoption of Total Platform services. However, it could benefit from more in-depth analysis or context on the broader market trends and implications for similar businesses.
Financial Relevance: Yes
Financial Markets Impacted: Joules’ stock price
Financial Rating Justification: The article discusses Joules’ financial performance and its impact on the company’s expected loss, which would affect its stock price in financial markets.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no extreme event mentioned in the article.
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