REG - Shoe Zone PLC - Interim Results
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RNS Number : 6524D Shoe Zone PLC 11 May 2026
Shoe Zone PLC
("Shoe Zone" or the "Company")
Interim results for the 26 weeks to 28 March 2026
Shoe Zone PLC is pleased to announce its interim results for the 26 weeks to
28 March 2026, (the "Period").
Financial highlights
• Revenue of £62.9m (2025 H1: £71.5m) -12.0%
o Store revenue £45.8m (2025 H1: £53.3m) -14.1%
o Digital revenue £17.1m (2025 H1: £18.2m) -6.0%
• Contribution of £4.8m (2025 H1: £6.4m)
o Store contribution of £1.8m (2025 H1: £3.3m)
o Digital contribution of £3.0m (2025 H1: £3.1m)
• Loss before tax of £5.3m (2025 H1: Loss £2.3m)
• Adjusted loss before tax of £5.3m (2025 H1: Loss £2.6m)*
• Earnings per share of -11.5p (2025 H1: -4.9p)
• Net cash of £7.5m (2025 H1: £1.7m)
• No interim dividend proposed (2025 H1: Nil)
Operational highlights
· 259 stores at Period end (2025 FY: 269) comprising:
o 206 New Format (2025 FY: 201)
o 53 Original (2025 FY: 68)
· 4 stores opened, 3 refits, 14 stores closed
· Capital expenditure of £1.4m (2025 H1: £1.0m)
· Annualised lease renewal savings of £44k, with an average reduction
of 4.1%
· Average lease length of 2.3 years (2025 FY: 2.5 years)
· Digital returns rate of 11.9% (2025 H1: 11.4%) - 12 months' average
Outlook
· As announced on 22 April 2026, the Company now expects an adjusted
loss before tax for the full year of between £1.0m and £2.0m.
*No adjusted items in the Period, adjustment in 2025 H1 related to £0.3m
forex gain.
For further information please call:
Shoe Zone
PLC
Tel: +44 (0) 116 222 3001
Charles Smith (Chairman)
Terry Boot (Finance Director)
Zeus (Nominated Adviser and
Broker)
Tel: +44 (0) 203 829 5000
James Hornigold, Ed Beddows (Investment Banking)
Dominic King (Corporate Broking)
Chairman's statement
Introduction
Shoe Zone experienced a very challenging trading environment in the Period
against the continuing backdrop of weak consumer confidence and macro/global
economic volatility. Total revenues reduced by 12.0% to £62.9m, having traded
out of 19 fewer stores compared to 12 months ago, with digital revenue
reducing by 6.0%.
Store revenues were £45.8m (2025 H1: £53.2m - trading out of 19 fewer
stores), digital revenues were £17.1m (2025 H1: £18.2m), reflecting similar
trading conditions as seen in our stores.
Adjusted loss before tax was £5.3m (2025 H1: Loss £2.6m*).
We ended the Period trading out of 259 stores, which is a reduction of 19
compared to 12 months ago and 10 lower compared to last year end. In the first
half we closed 14 stores, opened 4 larger format stores and refitted 3
Original stores to our new larger format. In total we are now trading out of
53 Original stores and 206 larger format stores. We are actively working to
relocate and refit further stores in the second half of the year, with a
number of relocations currently in the pipeline.
We have completed 19 lease renewals/re-gears in the Period with an annualised
saving of £44k, with an average reduction of 4.1%.
Our average lease length is 2.3 years (2025 FY: 2.5 years), which gives the
opportunity and flexibility to respond to changes in any retail location at
short notice. Property supply continues to outstrip demand, and we continue to
take advantage of this and further improve our property portfolio over the
medium term.
We are in the process of reducing the size of our Distribution Centre. The
whole site is made up of 6 leases, and we will exit 3 of these, reflecting the
reduction in store numbers and right sizes us for the future.
Strategy Update
Our refit and relocation programme continues, albeit at a slower pace, and we
now have 206 stores converted to our new, larger format. We expect to spend
approximately £3.0m on capital projects this year, which is a similar level
to the previous year, and we will continue to invest until all stores have
been converted. Our long-term objective is to be trading out of approximately
260 stores in total, and the Board currently expects, subject to market
conditions, to complete our relocation and refit programme by the end of 2027.
We continue to invest in our Digital infrastructure and having introduced a
new mobile App and new payment methods, we recently started to trade on TikTok
shop, and we will continue to look at adding further marketplaces this year.
Dividend
The Board does not propose an interim dividend (2025 H1: £nil).
Outlook
Our full year adjusted profit before tax forecast was previously £1.0m,
however, as announced on 22 April 2026, we are reducing this to an adjusted
loss before tax of between £1.0m and £2.0m. Trade continues to be negatively
impacted by a further weakening in consumer confidence, following the
Government's last two budget announcements, as well as the geo-political
issues in the Middle East. These macroeconomic factors have increased customer
caution, leading to lower footfall and less discretionary spend. The Middle
East issues have also resulted in a higher cost of containers and general
transportation costs.
The second quarter showed an improvement in underlying trading compared to the
first quarter, however, the trading environment continues to be difficult and
has been further impacted by worsening geo-political conditions in the Middle
East. Over the last 12 months we have seen more stability in the price of
containers, and a strengthening of sterling against the dollar, but these
conditions have recently reversed as fuel prices have increased and sterling
has weakened, both of which are expected to negatively impact the second half
of the year.
Financial Review
Loss before tax was £5.3m, with adjusted loss the same at £5.3m (2025 H1:
Loss £2.3m adjusted to £2.6m). The £2.7m reduction for the half splits into
quarter one a £2.0m reduction and quarter two a £0.7m reduction. Within
quarter two there were £0.5m of impairment and asset write-offs, therefore
excluding these items, underlying trading performance in Q2 improved relative
to Q1, although both quarters were negatively impacted by the macroeconomic
and geo-political factors.
In the Period, total revenues were £62.9m (2025 H1: £71.5m). Store revenues
decreased by £7.5m as we traded out of 19 fewer stores compared to 12 months
ago. Digital sales decreased by £1.1m to £17.1m (2025 H1: £18.2m).
Gross profit in the Period was £7.4m (2025 H1: £11.0m), with a margin of
11.8% (2025 H1: 15.4%). The £3.6m reduction reflects the sale performance and
the percentage decrease is due to a number of store related costs within cost
of sales, such as rent, rates and depreciation, that are fixed in nature and
therefore do not reduce as sales reduce. Product margins increased to 61.7%
(2025 H1: 59.4%) due to lower container prices and a more favourable sterling
to dollar exchange rate. Container prices have been stable over the last six
months, but the war in Iran has seen fuel price increases which will have a
negative impact for the rest of the financial year.
Administration expenses reduced by £0.5m to £9.2m (2025 H1: £9.7m), due to
a reduction in store impairments/write offs, partly offset by a lower foreign
exchange gain. All other costs were either in line with last year or lower.
Distribution costs remained the same at £2.8m (2025 H1: £2.8m) as we were
able to absorb the increase in the National Living Wage.
Inventory at the Period end was £6.5m lower at £28.0m (2025 H1: £34.5m).
This reflects the lower number of stores and the significant work completed in
making sure that stock levels are at the optimum level.
The Company ended the Period with a net cash balance of £7.5m (2025 FY:
£1.7m). Part of the difference relates to later stock purchases when compared
to last year. A lot of work has been done to lower stock purchases, reduce
costs and we continue to limit capital expenditure to only commercially key
projects.
Capital expenditure in the Period was £1.4m (2025 H1: £1.0m), £0.9m on
relocations and refits, £0.3m vehicles and £0.2m warehouse and IT.
Relocation and refit projects are weighted towards the second half of the
financial year as we continue our long-term target of converting all stores.
We expect expenditure to be approximately £3.0m for the full year.
The Shoefayre Limited Pension and Life Assurance Scheme deficit turned into a
surplus of £0.9m (2025 FY: £1.5m deficit). This was due to an increase in
bond yields and an increase in future inflation expectations over the period.
The overall impact of these market condition changes is to reduce the value of
the scheme's liabilities. However, this has been partly offset by the fall in
the value of the Liability Driven Investments (LDI) portfolio over the period.
Earnings per share were -11.5p (2025 H1: -4.9p per share) reflecting the loss
before tax in the Period.
Unaudited consolidated income statement (52 weeks audited)
26 Wks end 26 Wks end 52 Wks end
28 Mar 2026 29 Mar 2025 27 Sep 2025
£'000 £'000 £'000
Revenue 62,930 71,486 149,095
Cost of sales (55,487) (60,496) (121,458)
Gross Profit 7,443 10,990 27,637
Administration expenses (9,228) (9,726) (17,166)
Distribution costs (2,763) (2,823) (5,702)
Profit from Operations (4,548) (1,559) 4,769
Finance income - - -
Finance expense (758) (702) (1,513)
Profit before Tax (5,306) (2,261) 3,256
Taxation - - (1,367)
Profit after Tax (5,306) (2,261) 1.889
Earnings per Share (11.5)p (4.90)p 4.08p
Unaudited consolidated statement of total comprehensive income (52 weeks
audited)
26 Wks end 26 Wks end 52 Wks end
28 Mar 2026 29 Mar 2025 27 Sep 2025
£'000 £'000 £'000
Profit/(Loss) for the period (5,306) (2,261) 1,889
Items that will not be reclassified subsequently to the
income statement
DB pension scheme - 203 1,710
Movement in deferred tax on pension schemes - - (428)
Cash flow hedges
Fair value movements in other comprehensive income (368) 413 333
Tax on cash flow hedges - - (83)
Other comprehensive (expense)/Income for the period (368) 616 (1.532)
Total comprehensive (expense)/Income for the period (5,674) (1,645) 3,421
attributable to equity holders of the parent
Unaudited consolidated statement of financial position (52 weeks audited)
26 Wks end 26 Wks end 52 Wks end
28 Mar 2026 29 Mar 2025 27 Sep 2025
Assets £'000 £'000 £'000
Non-current Assets
Property, plant and equipment 17,310 20,774 19,712
Right of use assets 27,422 27,884 28,067
Total Non-current Assets 44,732 48,658 47,779
Current Assets
Inventories 28,025 34,484 32,579
Trade and other receivables 3,079 3,539 4,538
Cash and cash equivalents 7,517 1,698 5,947
Deferred tax asset - 39 -
Corporation tax asset - 659 -
Total Current Assets 38,621 40,419 43,064
Total Assets 83,353 89,077 90,843
Current Liabilities
Trade and other payables (16,453) (18,336) (17,437)
Lease liabilities (12,841) (12,217) (12,461)
Derivative fin. liability (356) - -
Deferred tax liability (175) - (298)
Provisions (1,361) (2,387) (1,431)
Total Current Liabilities (31,186) (32,999) (31,627)
Non-current Liabilities
Lease liabilities (21,039) (22,846) (22,144)
Provisions (737) (767) (1,007)
Employee benefit liability - (1,466) -
Total Non-current Liabilities (21,776) (25,079) (23,151)
Total Liabilities (52,962) (58,078) (54,778)
Net Assets 30,391 30,999 36,065
Equity attributable to equity holders of the company
Called up share capital 463 463 463
Merger reserve 2,699 2,699 2,662
Capital redemption reserve 37 37 37
Cash flow hedge reserve (193) 338 175
Retained earnings 27,422 27,499 32,728
Total Equity and Reserves 30,391 30,999 36,065
Unaudited consolidated statement of changes in Equity (prior years audited)
Share Share Capital Cash flow Retained Total
Capital Premium Redemp. Hedge Earnings
Reserve Reserve
£'000 £'000 £'000 £'000 £'000 £'000
At September 2024 463 2,662 37 (75) 29,557 32,644
Loss for the period - - - - (2,261) (2,261)
Defined benefit pension movements - - - - 203 203
Cash flow hedge movements - - - 413 - 413
Total comprehensive income for the period - - - 413 (2,058) (1,645)
Dividends paid - - - - - -
Contributions by and distrib. to owners - - - - (6,886) (6,886)
As at March 2025 463 2,662 37 338 27,499 30,999
At September 2024 463 2,662 37 (75) 29,557 32,644
Profit for the period - - - - 1,889 1,889
Defined benefit pension movements - - - - 1,710 1,710
Cash flow hedge movements - - - 333 - 333
Deferred tax on other comp. income - - - (83) (428) (511)
Total comprehensive income for the period - - - 250 3,171 3,421
Dividends paid - - - - - -
Contributions by and distrib. to owners - - - - - -
As at September 2025 463 2,662 37 175 32,728 36,065
At September 2025 463 2,662 37 175 32,728 36,065
Loss for the period - - - - (5,306) (5,306)
Defined benefit pension movements - - - - - -
Cash flow hedge movements - - - (368) - (368)
Total comprehensive income for the period - - - (368) (5,306) (5,674)
Dividends paid - - - - - -
Contributions by and distrib. to owners - - - - - -
As at March 2026 463 2,662 37 (193) 27,422 30,391
Unaudited consolidated statement of cash flows (52 weeks audited)
26 Wks end 26 Wks end 52 Wks end
28 Mar 2026 29 Mar 2025 27 Sep 2025
£'000 £'000 £'000
Operating activities
Profit after tax (5,306) (2,261) 1,889
Corporation tax - - 1,367
Finance income - - -
Finance expense 758 702 1,513
Depreciation of property, plant and machinery 3,553 3,822 6,884
Fixed asset impairment and loss on disposal of property,
plant and machinery 218 310 648
Right of use asset on profit, depreciation & 5,969 5,718 11,695
impairment and loss on
disposal
5,192 8,291 23,996
Decrease/(increase) in trade and other receivables 1,459 1,127 (66)
Decrease/(increase) in foreign exchange contracts (135) 609 138
Decrease/(increase) in inventories 4,554 3,467 5,372
(Decrease)/increase in trade and other payables (987) (6,341) (7,241)
Decrease in provisions (340) (320) (1,036)
4,551 (1,458) (2,883)
Cash generated from operations 9,743 6,833 21,163
Net corporation tax paid - (134) (684)
Net cash flows from operating activities 9,743 6,699 20,479
Investing activities
Purchase of property, plant and machinery (1,369) (968) (3,306)
Proceeds from Sale of Freeholds - - -
Net cash used in investing activities (1,369) (968) (3,306)
Capital element of lease repayments (6,840) (7,715) (14,921)
Interest 36 43 55
Dividends paid during year - - -
Net cash used in financing activities (6,804) (7,672) (14,866)
Net inc/(dec) in cash and cash equivalents 1,570 (1,941) 2,307
Cash and cash equivalents at beginning of period 5,947 3,640 3,640
Cash and cash equivalents at end of period 7,517 1,698 5,947
Notes to the financial statements for the 26 weeks ended 28 March 2026
Basis for preparation
The consolidated interim financial statements of the company for the 26 weeks
ended 28 March 2026, which are unaudited, have been prepared in accordance
with the same accounting policies, presentations and methods of computation
followed in the condensed set of financial statements as applied in the
group's latest audited financial statements. A copy of those accounts has been
delivered to the Registrar of Companies.
The financial information for the 26 weeks ended 28 March 2026, contained in
this interim report, does not constitute the full statutory accounts for that
period. The independent Auditors' report on the Annual Report and Financial
Statements for 2025 was unqualified, did not draw attention to any matters by
way of emphasis. And did not contain a statement under 498(2) or 498(3) of the
Companies Act 2006.
The consolidated interim financial statements have neither been audited nor
reviewed pursuant to guidance issued by the Auditing Practices Board.
The condensed consolidated interim financial statements have been prepared on
a going concern basis and under the historic cost convention, as modified by
the revaluation of derivative financial instruments to far value.
The condensed consolidated interim financial statements are presented in
sterling and have been rounded to the nearest thousand (£'000).
The preparation of financial information in conformity with IFRS requires
management to make estimates and assumptions that affect the reported amount
of assets and liabilities at the date of the financial statements and the
reported amount of revenues and expenses during the reporting period. Although
these estimates are based on management's best knowledge of the amount, event
or actions, actual events ultimately may differ from those estimates.
1. Accounting policies
In preparing these interim financial statements, the significant judgements
made by management in applying the group's accounting policies and the key
sources of estimation uncertainty were the same as those applied to the
consolidated financial statements reported in the latest annual audited
financial statements for the 52 weeks ended 27 Sept 2025.
Going Concern
At the balance sheet date, the company had a strong net asset position. Based
on the cash forecasts prepared by the Directors, these financial statements
have been prepared on a going concern basis.
2. Segmental Information
The group complies with IFRS 8 'Operating Segments' which determines and
presents operating segments based on information provided to the chief
operating decision maker. The chief decision maker has been identified as the
management team including the Chairman and Finance Director. The Board
considers that each store is an operating segment but there is only one
reporting segment as the stores qualify for aggregation, as defined under IFRS
8.
26 Wks end 26 Wks end 52 Wks end
28 Mar 29 Mar 27 Sep
2026 2025 2025
External revenue by location of customers: £'000 £'000 £'000
United Kingdom 45,698 53,116 112,658
Digital 17,080 18,202 36,065
Jersey 152 168 372
62,930 71,486 149,095
3. Taxation
The taxation charge of zero for the 26 weeks ended 28 March 2026 is based on
the assumption that the capital allowances available on our estimated capital
spend will reduce the expected charge at the half year.
4. Earnings per share
26 Wks end 26 Wks end 52 Wks end
28 Mar 29 Mar 27 Sep
2026 2025 2025
£'000 £'000 £'000
(Loss)/Profit in the period and earnings used in basic
diluted earnings per share (5,306) (2,261) 1,889
(11.5)p (4.90)p 4.08p
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