Shares in premium lifestyle brand Joules (JOUL:AIM) jumped 8p (2.3%) higher to 354p at the open on what Liberum Capital describes as ‘outstanding’ results for the year ended 27 May.

While the shares have since reversed those gains (down 2.5% at 340p as of 11am), this looks more a case of limited extra earnings upgrade fuel this morning. The stock is roughly 22% higher year to date.

Joules’ impressive annual numbers show that not all segments of the consumer landscape are struggling. And with a ‘buy’ rating and 420p price target, Liberum explains Joules ‘has been able to meet expectations across all lines having upgraded earnings per share forecasts some 19.2% from a year ago.’


This quirky British heritage brand was established by Tom Joule (the group’s Chief Brand Officer) almost three decades ago and spans clothing, footwear and accessories for women, men and children. The brand has been extended into an ever-growing range of homewares, toiletries and eyewear collections.

‘Quality, Britishness, family values, colour and humour make Joules stand out from the crowd’, says Joules, defying wider macro-economic uncertainties and proving an outstanding AIM-listed growth pick.

Annual results highlights include group revenue up 18.4% to £185.9m, ahead of consensus expectations of £185m and a 28.5% surge in underlying profit before tax to £13m, a performance CEO Colin Porter attributes to ‘the strength and appeal of the Joules brand, our unique product offer and our growing and loyal customer base.’

There’s also a hike in the full year dividend from 1.8p to 2p to sate income seekers.

Joules’ active customer numbers rose 23.4% to 1.15m – the brand boasts a loyal and growing customer base - and Joules is benefiting from being a truly multi-channel lifestyle brand. Porter insists there’s further potential for this immature brand to increase its physical retail selling space in the UK and Republic of Ireland.

‘Our UK store presence continues to play an important role in building brand awareness and driving new customer acquisition and retention,’ he explains. ‘In full year 2019, we anticipate opening 29 concessions, as we transition our existing wholesale partnership with John Lewis to a retail concession model for the womenswear category, and around six new stores.'

Joules’ retail revenue is almost 16% ahead at £129.7m, while its e-commerce, wholesale and especially international sales are all growing like topsy. The priority overseas markets are the US and Germany, where Porter insists ‘our brand and products are resonating well with our growing customer following.’


There’s a bullish outlook statement from Joules too. ‘The brand has strong momentum and we have seen good growth in the first few weeks of our new financial year with positive early feedback on our Spring/Summer 2019 ranges from our wholesale customers’, says the company.

And while ‘the shift towards online shopping in combination with sector discounting, cost and consumer spending pressures is making life incredibly challenging for some retail businesses’, Joules ‘is a distinctive brand with a strong connection with its customers and we have a flexible business model and multiple routes to market supported by a well invested infrastructure and a committed and enterprising team.’


‘Joules has a strong brand, heritage, low fashion risk and wide appeal,’ thunders Liberum. ‘It is gaining share in the fast-growing premium lifestyle sector where multiple growth levers exist including stores, online, wholesale and international. Joules is relatively immature versus key peers leaving space for growth.’

Over at Edison Investment Research, analyst Paul Hickman enthuses: ‘What sets the company apart from its peers is a relentless focus on customer engagement, which it is using its distinctive product ranges and a strategic focus on multi-channel distribution to achieve. In full year 2018 the company grew its active database by 23% to 1.15m customers and its e-commerce sales 28% to £49.8m, now representing 38% of retail revenue.

‘Joules is a growth company with a significant opportunity to increase market share overseas. We are now starting to see the brand become better established in the international markets, where clearly the opportunity is immeasurably larger than in the UK alone.'

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Issue Date: 25 Jul 2018