15th Aug 2022 17:50
(Alliance News) - The external change at the top of Joules Group PLC's leadership will bring a new set of ideas as the country lifestyle retailer looks to revitalise its fortunes, according to its corporate broker.
The Leicestershire, England-based firm on Monday appointed Jonathon Brown as its new chief executive officer, effective from September 30.
Brown will initially join the company as CEO designate on September 7 and then take up the role on September 30. Most recently, he was the CEO of Compare the Market, and has also held positions at retailers such as Kingfisher and John Lewis.
"Jonathon has well rounded experience from a broad base of bricks & mortar retailers and significant digital experience. He as led transformation projects and has run several branded businesses. As Joules is going through a strategic reshaping Jonathon's CV looks well adept to the challenges and opportunities ahead for Joules," analysts at Liberum said.
The new appointment comes after a profit warning for an under pressure Joules. Shares in the AIM listing have fallen over 80% over the past 12 months. The stock closed up 1.9% at 42.78 pence on Monday.
In early July, Joules confirmed it was in talks with KPMG International Ltd to shore up its balance sheet. The company was responding to a Sunday Times report which stated that KPMG's debt advisory arm is exploring options to solidify the retailer's cash position. Options being mulled at the time included a capital raise, the Sunday Times reported.
The call to KPMG followed an update in early May that its profit in its Easter trading period slumped, along with news that CEO Nick Jones was planning to step down.
Liberum analyst Wayne Brown said Brown was "well-rounded and brought "broad retail experience" to the role.
The appointment came as Joules was in talks with Next PLC about adopting its Total Platform services. The move, if it goes ahead, will see Next inject about GBP15 million into Joules.
As a result, Joules said Next would become a "strategic minority shareholder" in the lifestyle brand, without confirming the size of the stake. The equity investment would be subject to approval by Joules' shareholders, it added.
"He as led transformation projects and has run several branded businesses. As Joules is going through a strategic reshaping Jonathon's CV looks well adept to the challenges and opportunities ahead for Joules. Amongst these are rumoured deal with Next to take a 25% stake and move the group over to its Total Platform model," the analyst said.
In addition, Brown said the arrival of a new CEO is likely to "bring a fresh perspective" and the broker welcomed the positive changes taking place as Joules looks to rebuild its investment case.
"The group is making good progress on its plans to improve profitability by simplifying the business and optimising the cost base. This includes implementing the previously disclosed plans to reduce its global wholesale accounts to focus on long-term profitable partnerships, shorten product lead times, and diversify the group's ethically sourced supplier base," the analyst added.
By Arvind Bhunjun; [email protected]
Copyright 2022 Alliance News Limited. All Rights Reserved.
Related Shares:
JOUL.L