Shares in Joules were down almost a quarter this morning despite positive half year trading results.
The country lifestyle brand said sales and profits for the past six months had been strong – but had slowed on the back of supply chain issues, higher costs and stock delays.
In a six month trading update the Leicestershire clothes and homeswares business said: “In addition, labour shortages in our third-party operated distribution centre have resulted in extended product delivery times to online customers, stores and wholesale partners.
“These factors were particularly acute in November, including the Black Friday period, which alongside weaker year-on-year online traffic contributed to performance during this month being below expectations.
“Global supply chain challenges are expected to remain during at least the second half of the group's financial year and there is increased consumer uncertainty as a result of the emergence of the Omicron coronavirus variant.
“Supported by a strong stock position and wholesale order book, actions that have been taken to improve productivity at the distribution centre, and the ongoing strong customer demand for the group's products, the board is confident that the group will achieve continued strong revenue growth in H2 and an improved profit performance.”
The business said full year profit before tax and adjustments was now expected to be below current market expectations and in the region of £9 million to £12 million – assuming Covid restrictions don’t get worse – which would still be up on last year.
Shares in the business were down 23 per cent this morning at 149p.
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Joules recently moved into a new headquarters in its home town of Market Harborough, designed to make it easier for staff to work from home.
Revenues for the six months to the end of November were £128 million, it said, up 35 per cent on the same time last year, helped by shoppers being allowed back into stores following the lockdowns of 2020 and early 2021.
Store revenues were on a par with pre-pandemic levels while online sales were up more than 50 per cent on the same period two years ago.
Chief executive Nick Jones said: "Joules has achieved good revenue growth against the prior two comparative periods reflecting the strength of the group's flexible model and despite a challenging external trading environment.
“Alongside the strong appeal of our core Joules brand, the group continues to benefit from its increased diversification through Friends of Joules and Garden Trading, both of which continue to give customers even more reasons to shop with us.
"While we have not been immune to certain industry-wide pressures including supply chain disruption and cost inflation, we remain focused on delivering the group's long-term growth strategy.
“We have continued to invest in the business to support our plans and, despite the high levels of near-term consumer uncertainty, we remain very confident in achieving the group's exciting future potential."
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