British lifestyle group, Joules has announced that retail sales have been depressed over the five-week period to August 14, 2022, resulting in an 8 percent year-on-year reduction in retail sales in the 11 weeks of the current financial year to date.

As a result of the recent softness in trading and the current weak consumer sentiment, the company’s board expects a significant loss in the first half, followed by an improved performance in the second half as the benefits of business simplification begin to be realised. In light of this, the board currently expects the group to deliver a full year pre-tax loss, significantly below current market expectations.

The company added that the recent extremely warm and dry summer weather has adversely affected full price sales of core categories such as outerwear, rainwear, knitwear, and wellies and has compounded the ongoing subdued consumer demand due to cost of living crisis.

Wholesale trading for the Joules brand has achieved 10 percent growth year-on-year despite delays experienced in US ports, however Garden Trading wholesale has continued to be significantly impacted by the wider slowdown in the home and garden market.

The company further said that retail margins in the year to date have declined by 6 percent pts year-on-year due to the shortfall of full price sales and the level of discounting that has been required to engage customers in the highly promotions-driven retail landscape.

While overall margins have been weak in the year to date, Joules expects partial recovery in the coming months as sales of full price autumn/winter collections become a more important part of the mix.

Further to the announcement on August 7, 2022, Joules further said that the group continues positive discussions with Next Group Plc about both adopting its total platform services to support its long-term growth plans and a potential equity investment.