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Schuh's profits drop 21% as it invests in new stores

Schuh’s operating profit fell 21% from £14.8m to £12.1m in the year to February 1, 2014, as it invested in opening 17 new stores across the UK and Ireland.

The footwear retailer spent £23.6m on expanding its store portfolio during the period – more than double the £11.4m invested the year before. New locations included Jersey, London’s Covent Garden and Limerick.

Schuh’s sales dipped by 1.3% to £230m during the year, while EBITDA achieved an 8.3% margin, down from 8.8%.

Schuh’s new £7m 245,000 sq ft distribution centre opened in September in Bathgate, West Lothian. The space is five times larger than its other warehouse at Schuh’s headquarters in Neilson Square in nearby Livingston.

The new warehouse has 170 chutes and the capacity to increase to 270, and will become Schuh’s primary distribution centre, creating more than 50 jobs in Scotland over the next five years and catering for the “rapid growth” and planned future expansion of the Schuh store estate and online offering.

The Livingston warehouse will remain open, but will focus on returns and stock that is being moved around the estate.

Schuh also invested in a stock room conveyor at its Marble Arch store during the year to improve efficiency and stock room management, as well as kiosks where customers can buy from the online catalogue.

Speaking about trade to date in 2014 Schuh chief executive Colin Temple said: “In common with other retailers the mild weather has taken the shine off business a little, but we still remain reasonably confident that a change in the weather should get us back on track.”

 

 

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