Shoe Zone profits tumble

Shoe Zone.Shoe Zone.
Shoe Zone.
Retailer Shoe Zone has seen half-year profits tumble by 84 per cent after the Brexit-hit pound sent its buying costs soaring and sales fell amid a store overhaul.

The Leicester-based group saw pre-tax profits plunge to £309,000 in the six months to April 1, from £1.9m a year earlier.

Shoe Zone buys its stock from China in US dollars and has been hit hard by sterling’s fall since the EU referendum.

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Sales also came under pressure, down 2.3 per cent to £72.9m, as a restructure of its store estate saw the group close 12 outlets and open nine, including one in its new “Big Box” format.

Nick Davis, chief executive of Shoe Zone, said: “The devaluation of sterling against the dollar has impacted the group’s statutory profits in the period, however, as we reach the annualised re-basing of this rate, we anticipate the ongoing impact will be significantly reduced.”

Even with the sterling impact stripped out, underlying profits fell to £1.3m from £1.7m.

The group also cautioned that high street conditions will remain “uncertain given the political environment in the UK and across Europe in the coming months”.