Joules annual sales and profit rise as expansion pays off

Clothing retailer Joules posted a jump in annual profit and revenue on Wednesday as it reaped the benefits of its UK and international expansion.

In the 52 weeks to 27 May, underlying pre-tax profit rose 28.5% to £13m on revenue of £185.9m, up 18.4%, or 18.8% at constant currency. Joules said the group saw growth across all product categories, with a strong performance in the core womenswear segment, where outerwear, dresses and tops continued to prove popular.

International sales, which make up 13.1% of overall revenue, were up 35.7%, or 40.4% at constant currency, while UK sales increased 16.2% at constant currency.

Meanwhile, retail revenue was 15.9% higher at £129.7m and wholesale revenue increased 24.1% to £55.5m.

Active customer numbers were up 23.4% during the year to 1.15 million, with continued growth in new customers and increased retention and reactivation of the existing base.

Chief executive officer Colin Porter said: "It has been another strong year of growth for the Joules brand, with our continued expansion within the UK and international markets enabling the group to a profit performance ahead of initial expectations.

"This performance is testament to the strength and appeal of the Joules brand, our unique product offer and our growing and loyal customer base. We have made excellent progress against our strategy of expanding the brand both at home and abroad, and the board remains confident that this momentum will continue in FY19."

Peel Hunt said the £13m of pre-tax profit was slightly ahead of its upgraded forecasts of £12.7m.

"In a difficult retail and consumer environment, Joules remains a clear winner," the brokerage said.

It added that the £0.3m beat to its 2018FY forecast flows through to future years as its ups its 2019FY forecast from £14.5m to £14.8m, earnings per share of 13.5p.

"Trading on 12.7x EV/EBITDA and offering double-digit EPS growth, Joules remains one of the strongest global structural growth stocks in the in sector," Peel said.

At 1030 BST, the shares were down 1% to 342.50p.