Joules considers CVA process as retailer seeks turnaround

The group said that the restructuring process is among options for the group, alongside an equity raise.

A Joules store in Nottingham (Mike Egerton/PA) (PA Media)

Fashion and lifestyle brand Joules has said it is considering a company voluntary arrangement (CVA) restructuring process as part of its turnaround plans.

The company said on Monday morning that it is assessing its ongoing financing requirements, including the possibility of an equity raise.

It said this remains the company’s focus but that a CVA – which typically involves a firm agreeing delayed or reduced payments to landlords or other creditors – is “one of a number of alternatives”.

It comes after reports by Sky News that the struggling retail brand is in talks with specialists from Interpath Advisory over a process which could potentially pave the way for store closures, rent reductions and job cuts.

The Leicestershire-based brand employs around 1,000 people and runs around 130 stores.

Joules added on Monday that it is continuing to make “good progress” in developing its turnaround plan in a bid to improve profitability.

It highlighted that this will include a better pricing and promotions strategy, with more focus on product areas with shorter lead times.

“Joules also continues to make good progress on its simplification agenda and cost management process,” the firm added.

The retailer said last month it was considering a fundraising after a slump in shares over the past year following profit warnings amid soaring costs and a downturn in consumer spending.

Rival Next also launched talks with Joules over a deal to buy a minority stake in the business, but discussions between the two collapsed last month.