Footwear specialist Footasylum suffered a margin hit over Christmas and now predicts profit to come in at the lower end of expectations.

It said tough market conditions meant “promotional activity and discounting across the retail sector were higher than anticipated, with the result that Footasylum’s levels of promotional and clearance activity were greater than expected”.

Footasylum reported that total revenue was up 14% to £102.3m in the 18 weeks to December, and up 16% in the year-to-date to £200.8m.

Online sales rose 28% and revenue from stores was up 5% at £63.7m.

In light of the performance, the retailer is implementing a cost reduction plan which may result in some exceptional costs and it “now expects to report an adjusted EBITDA for [full-year 2019] towards the lower end of the current range of analyst forecasts”.

Footasylum executive chairman Barry Bown said: “In the context of the current tough conditions on the high street, we are encouraged to have delivered revenue growth across all of our channels and major product categories, with online and wholesale continuing to perform particularly well.

“We have also been pleased by the performance of the five new store openings and three upsizes that we completed in time for Christmas.

“However, the short-term outlook is undeniably challenging, and we continue to maintain our focus on cash, working capital and inventory management, as well as reducing costs across our operations.”