(Sharecast News) - Clothing retailer Joules reported an 18% decline in first-quarter group revenue on Wednesday but said this was an "encouraging" performance against a tough backdrop.
In an update ahead of its annual meeting, the company said revenue was ahead of its expectations of £39.6m. Revenue from the group's own e-commerce channels rose 63%, while the drop in overall revenue was down to the impact of the pandemic on Joules' stores and its wholesalers, many of whom were closed for much of the period.
Retail revenue fell 5%, although retail sales through the company's owned retail channels rose 1.5%, supported by a strong product and promotional offer, Joules said. Meanwhile, e-commerce revenue including third parties was up 45% against the prior year.
"This strong performance reflects increased customer traffic to Joules' websites and improved conversion rates. In addition, Friends of Joules, the group's digital marketplace has continued to perform very well with customers responding well to the enhanced product offer," the company said.
Joules began the phased reopening of its store estate on 15 June, with all stores reopened by early August. Since reopening, the stores have performed well and sales are ahead of the board's expectations, down just 10% compared to the same period a year ago thanks to strong levels of customer conversion.
"This reflects the well-balanced geographic locations of the group's retail stores, pent-up customer demand for Joules, and a strong promotional offer to help drive footfall," it said.
For the period overall, including the impact of store closures, retail store sales fell 49%.
Chief executive officer Nick Jones said: "The group's strong e-commerce performance demonstrates the appeal of Joules as well as our growing customer base and we continue to be very encouraged by the performance of our Friends of Joules digital marketplace. In addition, we have been pleased with the performance of our stores since re-opening with higher levels of conversion when compared to pre-lockdown and steadily improving footfall trends.
"As with all consumer-facing businesses we face challenging trading conditions and unprecedented levels of uncertainty over the coming months and into the peak Christmas trading season. Against this backdrop we remain cautious on the future trading outlook and will continue to tightly manage costs and conserve cash."
Joules had net cash of £8.5m at the end of the period, up from £4.5m at year-end and "significantly" ahead of the board's expectations. It has liquidity headroom of £57m and said it was well placed to manage potentially challenging trading conditions over the coming months.
At 0920 BST, the shares were up 6% at 97.35p.
Joules shares rise as earnings set to beat consensus despite pandemic