Joules has warned that its full-year loss will be “significantly below” market expectations after retail sales fell by 8% year on year in the 11 weeks to date.

The retailer said the recent warm and dry summer weather has adversely affected full-price sales of its core categories such as outerwear, rainwear and knitwear.

Retail margins in the year to date have declined by around six percentage points year on year, as a result of the shortfall of full-price sales and the level of discounting required to engage customers, it said.

Wholesale trading for the Joules brand has achieved 10% growth year on year despite delays experienced in US ports, however garden trading wholesale has continued to be significantly impacted by the wider slowdown in the home and garden market.

The retailer said it now expects a "significant" loss in the first half, followed by an improved performance in the second half. It expects a  full-year loss before tax, and before adjusting items - significantly below current market expectations.

The group also said it continues to have positive discussions with Next about adopting its Total Platform services and a potential equity investment.

Earlier this month, Joules has confirmed that it is in talks with Next about a potential purchase of around £15m of its shares, which is believed to equate to a significant 40% minority stake.

This week the lifestyle retailer announced that Jonathon Brown, former John Lewis omnichannel director, will become the new CEO from September. Brown will replace Nick Jones, who stepped down in May this year, amid continuous falling profits.

Tags cost of living Joules Next

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