News Column

Shoe Zone Posts Higher Profits For First Half But Lower Revenue

June 24, 2014

Rowena Harris-Doughty

LONDON (Alliance News) - Footwear retailer Shoe Zone PLC Tuesday posted a significant increase in profits for the first half of the year despite a drop in revenues due to lower expenses and costs in the business.

In its maiden results as a listed retailer, Shoe Zone reported a pretax profit of GBP2.7 million for the six months to April 5, up from only GBP178,000 the year prior, on the back of significantly lower administration expenses and distribution costs.

"The company has had a good first half with profits significantly ahead of the same period last year combined with a high level of cash conversion," said Chief Executive Anthony Smith in a statement, adding: "Our strong market position ensures we are well placed to benefit from any growth in the UK footwear market, and the board continues to look to the future with confidence."

Revenues in the period fell to GBP82.9 million, down from GBP98.9 million a year earlier, which it said was due to the planned closure of a number of temporary stores.

Shoe Zone said that so far in the second half, in the 10 weeks to June 14, like-for-like sales and margins have been in line with its expectations, while its online business remains strong and ahead of market growth projections.

During the first half, Shoe Zone said it opened three new stores, undertook two store relocations and refitted 19 stores.

The retailer launched its offering on Amazon at the end of last year, which it said in achieving good results.

Going forward, Shoe Zone said it will continue with its expansion plans, and investing in its online business as well as other new sales channels.

"Management will continue to enhance the property portfolio with further store openings, relocations and refits in this financial year," the company said.

The retailer has been expanding into new towns and cities, while rolling out it low cost store refit programme and relocating its existing stores into bigger and better locations as leases come up for renewal.

Shoe Zone shares were down 0.8% at 175.18 pence in early trading Tuesday.

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Source: Alliance News

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