Shoe Zone kicks guidance upwards as revenues stride ahead

25th Oct 2022 08:09

(Sharecast News) - Footwear retailer Shoe Zone lifted annual guidance after revenues surged by a third as stores were fully open after pandemic lockdowns.

The company on Tuesday said it now expected adjusted pre-tax profits for the year to 1 October 2022 to be at least £11m, compared with £9.5m a year ago.

Shoe Zone has already upgraded profit guidance twice this year. In August it was lifted to £10.5m from £9.5m in July and £8.5m in June.

Annual revenue rose 31.2% to £156.2m with the previous year impacted by the 16 weeks that stores were closed under Covid lockdown restrictions.

Shoe Zone ended the year trading out of 360 retail stores compared with 410 in 2020/21. It has closed 63 stores, opened 13 and refitted 11. The total is made up of 271 original Shoe Zone stores, 45 "big box" and 44 Hybrid stores. During the year it sold 14 freehold properties, which generated a profit on sale of £1.4m.

Digital revenue fell 13.6% to £26.4m, from £30.6m the previous year, and now represented 16.9% of group revenue, down from 25.7%. Margins were steady at 61.3%.

The company also announced a one off second interim dividend of 3p a share.

Shoe Zone ended the period with net cash of £24.4m, compared with £14.6m a year earlier.

"We continue our strategy to expand our hybrid and "big box" formats via refits and relocations. Shoe Zone continues to show how resilient it is, with a proven track record of delivering robust results during times of economic uncertainty," said chief executive Anthony Smith.

Reporting by Frank Prenesti for Sharecast.com