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Profit warning from Shoe Zone after mild autumn

Shoe Zone has warned that the mild weather during the autumn slowed revenues for the six months ended April 4.

The value footwear retailer said while volumes had increased, the average price was down due to the different product mix sold, explaining that it sold more lower-priced ladies ankle boots than long-leg boots, for example.

It said margins remained robust throughout the half-year period and its stock levels have been managed with no need for additional discounting.

Revenues and profit for the first half will be behind the same period last year and full-year results are expected to be below market expectations, with the dividend being adjusted accordingly, it said.

It said the company’s net cash position will remain strong.

During the period, Shoe Zone opened nine new stores and agreed terms on a further 10 sites. It also said its online sales performed strongly and growth is ahead of schedule.

Chief executive Anthony Smith said: “We experienced tougher than anticipated trading conditions in the first half and whilst we are having to reset expectations for the full year, the company’s proposition is still very strong; we have confidence in our overall strategy and we continue to see significant opportunities ahead.”

Shoe Zone, which floated on Aim last May, will report its interim results for the six months to April 4 on June 10.

In January in its first full-year results since floating, it posted a 124% rise in pre-tax profits to £11.4m for the year to October 4, although revenue dropped 10% to £172.9m due to the planned closures of temporary stores.

@Tara_Hounslea

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