Joules shares plunge after profit warning, fall continues
Shares in Joules plummeted after it released a profit warning on Tuesday and the downward trend continued on Wednesday, although not at the same pace.
The company has faced significant supply chain issues in recent periods and had said that these were “particularly acute in November, including the Black Friday period”. Alongside weaker year-on-year online traffic, that contributed to its performance being below expectations.
It all means its profit for the full year will be several million pounds below what had been forecast. That sent the shares down almost 27% on the day. And while such falls can often ease once investors have fully digested the results report, that didn’t happen in this case.
Despite the company saying it was generally confident for the future, the share price continues to drop on Wednesday morning albeit only by a tiny amount.
Shareholders were clearly spooked by the profit warning and perhaps justifiably so. It was only in early 2020 that the company had issued a profit warning due to a partly self-inflicted sales fall during the last ‘normal’ Christmas shopping season (2019). The business had seen a “disappointing online sales performance due to an internally generated stock availability issue through the important end-of-season sale event”.
And with the woes of the pandemic period still impacting results, the nervousness of shareholders is understandable.
That said, the share price remains comfortably above its spring 2020 pandemic low of 60p with a price of 144.5p each on Wednesday morning, giving the firm a market capitalisation of £161.4 million. However, in June 2018, the shares had reached 384p each and this June, they were at 300p.
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