A Christmas trading update earlier this month hinted that things were going well for clothing chain Joules (JOUL), but another round of analyst upgrades suggests the market was pleasantly surprised by these half-year figures. Analysts at Liberum had already pushed through an earnings upgrade of 6 per cent on the back of the Christmas numbers – sales rose by a fifth – but chose to crank-up annual forecasts by another 3 per cent again in response to this performance. Liberum now expects pre-tax profit of £12.5m for the year ending May 2018, giving EPS of 11.4p, compared with £10.1m and 9p in FY2017.
Admittedly, these numbers only go up until the Black Friday weekend, but combined with the Christmas update it shows that there was no let up in trading activity through the festive season, whereas the performance of some peers was decidedly patchy. This relative resilience is unsurprising when you consider that active customers have grown by 55 per cent the past three years, outstripping store space expansion of 23 per cent. This suggests the company has managed to grow its customer base successfully via its online and wholesale channels. In fact, wholesale business in the US is really starting to take off, helping international sales rise by more than a quarter to represent 11.3 per cent of the group total.
| JOULES (JOUL) | ||||
| ORD PRICE: | 320p | MARKET VALUE: | £280m | |
| TOUCH: | 320-328p | 12-MONTH HIGH: | 331p | LOW: 208p |
| DIVIDEND YIELD: | 0.6% | PE RATIO: | 37 | |
| NET ASSET VALUE: | 38p* | NET CASH: | £3m | |
| Half-year to 26 Nov | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 81.4 | 6.9 | 6.1 | 0.6 |
| 2017 | 96.2 | 8.3 | 7.3 | 0.7 |
| % change | +18 | +21 | +21 | +17 |
| Ex-div: | 8 Mar | |||
| Payment: | 10 Apr | |||
| *Includes intangible assets of £11.4m, or 13p a share | ||||
