Joules share price collapsed after the company moved into administration. The stock crashed to 10p, meaning that they have plunged by over 96% this year alone. The company joins other struggling British companies that have gone bankrupt this year.
Joules is a British retailer that was started in 1980s. The firm focuses on clothes for all people, which it sells in hundreds of stores in the country. It has over 1,600 employees in the UK and other European countries. Last week, the firm said that it was working on a turnaround plan in a bid to be a leaner and simpler organization. It also said that it was considering exiting the US and European locations.
The statement also said that the company was seeing weaker performance than what it was expecting. Retail e-commerce sales declined as traffic to its online stores plunged. It also hinted that it was considering strategic alternatives because of its weak cash position.
In a statement on Monday, Joules said that talks with other strategic investors hald faltered. As a result, the company decided to appoint administrators from Interpath Advisory. Most importantly, the company also said that it was suspending trading of the ordinary shares on AIM effective Monday.
Many British companies are currently in trouble as interest rates rise and the cost of living remains at an elevated level. For example, shares of leading companies like Boohoo, Asos, and Next PLC have all crashed in the past few months. Made.com shares have also collapsed after the company decided to file for bankruptcy.
And last week, Marks and Spencer warned that a storm was gathering for British retailers as high costs continue. In a separate note, an analyst said:
“No one is immune to the challenges facing the retail sector,” said retail analyst Natalie Berg. Brands that were considered invincible just a few years ago are now falling by the wayside. You’d think Joules would be more insulated because they’re targeting the middle classes, but everyone is looking to shop a bit smarter.”
Joules share price will remain at the current level now that they have been suspended. As such, it will not be possible for people to buy or even sell the stock. The only hope for the shares is if a new investor comes in and acquires the company from bankruptcy, which is highly unlikely.
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