Retailer Shoe Zone has braced investors for a £1 million full-year loss as it reported sliding sales due to cost pressures and warned shopper confidence remained under pressure.
The group saw shares plunge by as much as 22% as it reported a 4.5% drop in revenues to £142.4 million for the 53 weeks to October 3.
It said it expects to swing to an underlying loss of around £1 million in the full year, against profits of £2.4 million the previous year.
Shoe Zone cautioned the autumn/winter season had so far been slower than expected, which had knocked the final weeks of its financial year and was continuing so far into its first quarter.
Sales were also weighed on by shop closures, with the chain’s estate falling to 251 at the year-end, down from 269 in October 2025.
Shoe Zone highlighted efforts to relocate and revamp its retail chain into newer and bigger formats which it wants to complete by the end of 2027, with its portfolio now made up of 211 larger format stores and 40 original high street stores.
Chairman Charles Smith said: “This was a challenging year, particularly in the first half, as consumer confidence continued to be weak, and fell further following the Government’s November 2025 budget, with persistent inflation, higher interest rates remaining elevated and reduced levels of disposable income all contributing to a generally negative economic and consumer sentiment in the UK.
“Sales were good when there was a clear reason to buy, such as the warm summer and the Back-To-School season.
“However, overall discretionary spending remains subdued as consumers exercise greater caution in their expenditure.”
It also told investors that the Iran war conflict had resulted in higher fuel and transportation costs and pushed up the price of containers used for shipping, which it warned could weigh on financial performance.
It said: “We continue to monitor the macro and geo-economic/political environment closely and await the outcome of the Government’s October 2026 Budget.
“We have recently seen an increase in container prices and a weakening of Sterling to Dollar exchange rate, as well as an increase in fuel prices, all of which could negatively impact trading.”
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