Shoe Zone has revealed a fall in profits and sales as it closed a number of loss-making stores and invested in its Leicester distribution centre.
The value footwear retailer said pre-tax profit fell from £2m to £1.91m in the six months to April 2. Sales fell 4.6% to £74.6m as the retailer closed 23 loss-making and temporary stores during the period.
Shoe Zone revealed it was set to launch its “big box” format in three locations in August. “This will allow Shoe Zone to access the important out-of-town market, creating a new avenue for growth,” said chief executive Anthony Smith. The retailer will provide an update on this trial at the full year results in January 2017.
Shoe Zone said it pumped “significant” investment into its Leicester distribution centre during the period, with the opening of a new online fulfilment area.
During the six months, the chain improved its store portfolio, with the creation of 53 “Grade 1” stores. Rent renewals dropped by an average of 29.9%, creating a total saving of £222,000.
On the results, Smith said: “We have continued to make good progress with our store portfolio upgrade and rationalisation programme and I am pleased with the performance of the group in what was another difficult period for the clothing and footwear industry. The Grade 1 format increased by 53 stores in the period and further additions will be made in the second half.
“The Group has traded in line with management’s expectations since the period end and the board continues to look to the future with confidence.”
Shoe Zone said non-desktop accounted for 70% of online visits to Shoezone.com, up from 64% in the previous year.