Country casuals chain Joules is not ruling out a CVA to help it through its current trading problems.
The fashion and homewares business has seen its share value fall off a cliff in recent months amid concerns over its financial future.
The Market Harborough-based business previously warned that profits would be well below forecasts due to Covid, rising costs and tighter consumer spending. Things got worse when a recent deal for Next to take a stake in the business fell through.
Media reports originally surfaced last month that the business – famous for its colourful rainwear, knitwear and wellies – had been considering a CVA, which is an agreement with creditors to allow a percentage of debt to be written off to allow it to stay in business.
In a new trading statement Joules said: “Joules continues to make good progress in developing its turnaround plan which focuses on driving higher profitability including through: a better pricing and promotional strategy; focusing on more profitable product categories with shorter time to market; and optimising the Group's channel mix.
“Joules also continues to make good progress on its simplification agenda and cost management process.
“As previously announced, the group continues to assess its ongoing financing requirements, including a possible equity raise, to allow the company to strengthen its balance sheet and provide a strong platform to support the turnaround plan.
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“Whilst this remains the board's focus, the Company also continues to consider a range of other potential options which may be available to it, where a CVA is one of a number of such alternatives, and notes it has not determined if such alternatives are required.
“A further announcement will be made if and when appropriate.”
It comes after reports by Sky News that Joules was in talks with specialists from Interpath Advisory over a process which could potentially pave the way for store closures, rent reductions and job cuts.
This time last year the business, which has about 135 shops and more than 1,000 employees, was celebrating the opening of its smart new £20 million headquarters – with space for 600-700 people – in its south Leicestershire home town.
