REG - Shoe Zone PLC - Full Year Trading Update

Shoe ZoneAnnouncement

17/10/2023 07:00

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RNS Number : 2827Q  Shoe Zone PLC  17 October 2023

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Shoe Zone plc

("Shoe Zone" or the "Company")

Full Year Trading Update

Strong sales and highest recorded profits

Shoe Zone is pleased to announce its unaudited full year trading update for
the 52 weeks to 30 September 2023 ("FY 2023").

Financial Highlights:

·    Group revenue increased by 6.1% to £165.7m (FY 2022: £156.2m)

·    Store revenue of £134.8m (FY 2022: £129.8m), digital revenue of
£30.9m (FY 2022: £26.4m)

·    Store numbers: 323 (FY 2022: 360)

·    Product margin of c.62.1% (FY 2022: 61.2%)

·    Net cash of £16.4m (FY 2022: £24.4m)

·    Adjusted profit before tax expected to be not less than £16.0m1 (FY
2022: £11.2m)

·    Share buy-back programme continued with 3.8m shares bought back at a
cost of £8.1m

1 Adjusted to exclude the profit on sale of one freehold property and foreign
exchange revaluations

Financial Summary

Revenue

In the 52 weeks to 30 September 2023 revenue was £165.7m (FY 2022: £156.2m).
The 6.1% increase is due to strong second half trading particularly in peak
summer and our key back to school period, and this is trading out of 37 fewer
stores than last year.

Digital revenue was £30.9m (FY 2022: £26.4m) an increase of 17.0%. This
represents 18.7% of Group revenue (FY 2022: 16.9%) and this continuing growth
is validation of the ongoing investment in our digital platform.

 

Product margin

Product margin increased to c.62.1% (FY 2022: 61.3%). This is due to lower
container prices part way through the year, and improved stock management due
to less market volatility.

Profit before tax

Adjusted profit before tax is expected to be not less than £16.0m (FY 2022:
£11.2m). This is adjusted for £0.3m profit on sale of one freehold property
and a foreign exchange revaluation loss of £0.6m. Shoe Zone has traded
positively during the period, particularly in the second half of the year
which included our key Back to School period.

Net cash

The Company ended the year with net cash of c.£16.4m (FY 2022: £24.4m). The
reduction in net cash balance was due to dividends paid of £8.2m, further
share buy-backs in the year of £6.4m and an increased level of capital
expenditure to gross £11.3m (net £9.6m), offset by the cash generated from
profitable operations.

Dividend

A 2.5 pence per share interim payment amounting to £1.2m was made in August.

A final dividend, the amount of which is yet to be determined, will be
proposed in January 2024 alongside our final results.

Share Buy-back programme

The Company continued its programme of share buy-backs, and as at the year-end
had purchased in total 3.8m shares at a cost of £8.1m and at an average price
of £2.14. We have cancelled 3.75m shares.

Store numbers

We ended the year trading out of 323 (FY 2022: 360) retail stores. We closed
72 stores, opened 35 and refitted 15. The total is made up of 188 original
Shoe Zone stores, 42 Big Box and 93 Hybrid stores. We continue our strategy to
expand the number of Hybrid and Big Box formats through relocations and refits
of existing Shoe Zone stores.

 

Chief Executive Update, Anthony Smith

"I am pleased to announce that Shoe Zone has had a strong year, continuing the
momentum gained from the positive year we had in 2022. We continue our
strategy to expand our Hybrid and Big Box formats via refits (15) and
relocations and new stores (35). Shoe Zone continues to show how resilient it
is, with a proven track record of delivering robust results during times of
economic uncertainty.

We look forward to updating shareholders in more detail at the time of our
final results in January 2024.

I would like to thank all of our teams for their continued commitment and hard
work that have produced these great results."

 

For further information please call:

Shoe Zone
PLC
Tel: +44 (0) 116 222 3001

Anthony Smith (Chief Executive)

Terry Boot (Finance Director)

 

Zeus (Nominated Adviser and
Broker)
                Tel: +44 (0) 203 829 5000

David Foreman, James Hornigold, Ed Beddows (Investment Banking)

Dominic King (Corporate Broking)

 

About Shoe Zone

Shoe Zone is a Town Centre, Retail Park and Digital footwear retailer,
offering low price, high quality footwear for the whole family.

Shoe Zone operates from a portfolio of 323 stores and has approximately 2,400
employees across the UK.

The store portfolio consists of 188 high street stores containing the core
Shoe Zone product range and 93 hybrid high street stores and 42 larger Retail
Park stores which also have additional brands such as Skechers, Hush Puppies
and Kickers.

shoezone.com, combined with the store network, ensures a full multi-channel
offering for great customer service.

During an average year Shoe Zone sells 14.1 million pairs of shoes per annum
at an average retail price of c£13.50.

 

 

 

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