Joules CEO to exit as it warns cost-of-living crisis has hit profits

Joules CEO exits
Joules CEO Nick Jones exits
// Joules CEO Nick Jones is to leave the fashion retailer during the first half of its next financial year
// The retailer also flagged that profit performance in its latest quarter had been hit by falling consumer confidence

Joules CEO Nick Jones is to exit the fashion retailer as it flagged challenging conditions since Easter have hit profits in its latest quarter.

Jones, who has been CEO at Joules for three years, will step down during the first half of the retailer’s next financial year. Joules will begin the search for his successor.

The retailer warned that profits had fallen below expectations for the 13 weeks to 1 May as the market had become increasingly promotional, which had hit margin, and demand for home and garden had been subdued.

This has led to its Garden Trading business performing “significantly below expectations” over its peak sales period in March and April.

The retailer said that market conditions had become “more challenging” during and following the Easter period as consumer confidence has been impacted by the rising cost of living. 

Meanwhile, stock delays and lower demand had led to weaker than expected third party sales.

Joules said it expects trading challenges to continue during the first half of its current financial year and said it was “cautious” about its near-term outlook. Joules is focusing on improving profitability and cash generation through cost cutting and clearly aged stock. 

READ MORE: Joules commercial director to exit fashion retailer

The retailer is pushing ahead with plans to simplify the business and optimise its cost base. This includes exiting the wholesale model in the US and EU and introducing higher minimum order quantities in the UK. 

It plans to improve its end-to-end product process to reduce costs and shorten lead times by up to four months, which will enable Joules to increase the proportion of newness, and therefore the opportunity for full price sales.

Joules is also widening its supplier base to reduce its exposure to China, although it pointed out it is not currently experiencing significant delays as a result of the latest Covid lockdowns in the country.

Joules chairman Ian Filby said: “I would like to thank Nick for his significant efforts over the last three years. He has led the business with integrity, care, and energy during what has been a particularly challenging period for the retail sector, including during the Covid-19 pandemic.

“Under Nick’s leadership Joules has made good progress against its strategy to develop as a digital-led lifestyle group. More recently, he has led the business in implementing a number of important strategic initiatives that will underpin the group’s future over the coming years.”

Jones added: “Building on the strategic progress made so far, over the coming months we will continue to deliver against the clear priorities that the board and I believe will create a strong foundation for Joules to achieve its significant long-term potential, as well as helping the business to navigate the current challenging trading environment.

“Joules is a fantastic brand with great people, loyal customers, and a differentiated product offering. Underpinned by the strategic actions we are taking to optimise the business, Joules will emerge stronger and better positioned to achieve long-term, profitable growth.”

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