THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF REGULATION (EU) NO 596/2014
Joules Group plc
('Joules' or the 'Group')
Acquisition of Garden Trading
Joules, the premium British lifestyle brand, is pleased to announce that it has acquired The Garden Trading Company Limited ("Garden Trading"), a digitally led retailer of home and garden products inspired by the British countryside and lifestyle trends (the "Acquisition").
Garden Trading designs its own range of distinctive home, garden and outdoor products that it sells through its own digital platform direct to consumers and to more than 1,000 stockists across the UK. Garden Trading has seen rapid growth in its e-commerce revenue over recent years as it has broadened its product range and increased its customer base. Garden Trading has been a leading seller on the Friends of Joules digital marketplace since Joules launched the marketplace in 2019.
Strategic rationale
The Acquisition supports Joules' strategy to grow its customer base, broaden its product offer and strengthen its digital platform.
The Acquisition strengthens Joules' position in the important and fast-growing home, garden & outdoor category. Garden Trading has a close cultural alignment with Joules, and both share the same design-led approach to creating distinctive, quality products that are loved by their customers.
Joules intends to continue to develop and grow the Garden Trading brand and product range whilst also seeing opportunity to leverage Garden Trading's design and sourcing strengths to develop a broader range of Joules-branded home, garden and outdoor products.
For the year to 30 November 2020, Garden Trading delivered revenue of £16.8 million, up more than 40% on the prior year, and a profit before tax of £2.0 million1.
The acquisition is expected to be earnings accretive for Joules FY22 financial year.
Transaction overview
The consideration for the Acquisition is split between an upfront and a deferred element. The upfront consideration is for £9 million subject to certain customary completion adjustments. The upfront consideration is comprised of a £4.5 million cash payment (on a cash free, debt free basis subject to a normalised level of working capital) and 2.83 million new Joules ordinary shares of 1 pence each ("Ordinary Shares")2. The deferred consideration is for up to £3.5 million (of which at least £3 million will be paid in cash and the rest either in cash or Ordinary Shares, at the Group's discretion), subject to Garden Trading meeting certain targets over the period to 30 November 2021. Any Ordinary Shares issued pursuant to the Acquisition are subject to certain customary lock-up and orderly market arrangements.
Garden Trading's founder and Managing Director, Jon Holloway, will remain with the business until the end of December 2021.
Nick Jones, CEO of Joules, commented: "We are delighted to announce the acquisition of Garden Trading, which is a fast-growing and highly complementary brand to Joules in the attractive home, garden & outdoor category. The acquisition will help to increase the Joules customer base, broaden our product offering and strengthen our digital platform, which are three of the Group's key strategic growth pillars.
"The Garden Trading brand shares similar design-led principles to Joules and, as has been demonstrated through its stand-out popularity on the Friends of Joules digital marketplace over the past 15 months, is highly relevant to our customers and their lifestyles.
"Garden Trading has a fantastic team and culture, which is closely aligned to Joules'. I am delighted to welcome Garden Trading's team to the Joules family and look forward to working with them all over the coming years."
Jon Holloway, Founder of Garden Trading, commented: "We are delighted to be joining Joules, which is a business and brand I have long admired. Since we started selling through the Friends of Joules digital marketplace more than a year ago it has become increasingly clear how well our products and brand resonate with the Joules customer base. In addition, by working with the Joules team it is clear that we share similar values, culture and customer-centric approach.
"I would like to take this opportunity to thank all my colleagues as well as our loyal customers who have helped to develop Garden Trading into the established and popular brand it is today. With the continued dedication of the Garden Trading team alongside the support and infrastructure that Joules offers, I am very confident in the growth opportunities ahead for the Garden Trading brand."
A conference call for analysts will be held at 8:30am this morning. Please RSVP to joules@hudsonsandler.com for details.
(1) Unaudited financial information: For the year to 30 November 2020, Garden Trading delivered revenue of £16.8 million (FY19: £11.9 million) and a profit before tax of £2.0 million (FY19: £0.7 million). Garden Trading's gross assets as at 30 November 2020 were £8.0 million (30 November 2019: £4.8m).
(2) The number of Joules Group plc ordinary shares is based on the 30 business day volume weighted average price to 5 February 2021 of £1.591
Enquiries:
| Joules Group plc Nick Jones, CEO Marc Dench, CFO | Tel: +44 (0) 1858 435 255
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Peel Hunt LLP, Nominated Advisor and Joint Broker George Sellar Andrew Clark Will Bell |
Tel: +44 (0) 20 7418 8900
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Liberum Capital Limited, Joint Broker John Fishley Edward Thomas |
Tel: +44 (0) 20 3100 2000 |
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Hudson Sandler (Financial PR) Alex Brennan Lucy Wollam |
Tel: +44 (0) 20 7796 4133
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Joules - a premium lifestyle brand with an authentic British heritage
Joules is a premium lifestyle brand with an authentic heritage. The Joules brand is about family, fun and joy in the countryside. Joules creates and curates exceptional products that brighten the lives of its customer, delivered through a leading digital platform that is supported by enticing experiences and stores that are located in desirable locations relevant to the Joules customer's lifestyle.
The Joules story began in 1989, when Tom Joule started selling clothing on a stand at a country show in Leicestershire. Today, the business designs and sells Joules branded clothing, footwear and accessories for women, men and children … with collections of homeware, toiletries, lifestyle and pet product ranges that are carefully designed and developed through selected licensing partnerships
Joules' distinctive design-led products are complemented by an increasingly broad customer offer provided through its digital marketplace Friends of Joules, enabling third party brands to offer curated, complementary products to the Joules customer base, enhancing Joules' digital platform with thousands of products from hundreds of creative businesses to give customers everything they could ever need for a contemporary country lifestyle.
The Joules brand caters to its 1.5 million active customers through its own digital platform, its retail stores in the UK and at country shows and events. Joules extends its brand reach through well-established 3rd party relationships - concessions, online marketplaces and traditional wholesale - in the UK and internationally.
Internationally, the brand has made good progress in its target markets of the US and Germany, where the distinctive Joules brand and products range resonate well with local customers. International markets are served by wholesale partnerships and dedicated Joules websites.
Joules' performance has been recognised through several awards including:
- Mainstream Brand of the Year - Drapers Awards 2019, 2017 and 2016
- Best Licensed Fashion or Talent Brand Award - Brand & Lifestyle Licensing Awards 2019
- Best Licensed Gifting Product Award - Brand & Lifestyle Licensing Award 2019
- The Best Fashion Retailer (Mark of Excellence) - Retail Week Awards 2019 and 2018
- Fashion Retail Business of the Year (between £101m-£500m turnover) - Drapers Awards 2018 and 2017
Garden Trading - fast facts
- Garden Trading was founded by Jon Holloway in 1994
- Initially focused on garden products, the business has successfully expanded into lighting, homeware, indoor furniture and kitchenware to meet the growing needs of their customers
- Design-led, in-house product development of own branded ranges with a philosophy of combining simple, stunning design with high quality outdoor products that would stand the test of time
- Sells through its website direct to consumers and to more than 1,000 stockists across the UK.
- More than 100,000 followers in Instagram with high levels of customer engagement
- Customer review rating of 4.6/5
- Amongst one of the first brands to be awarded Feefo's Platinum Trusted Award, the highest award, which launched in 2020
- Headquartered in Oxfordshire
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