Best foot forward: Shoe Zone reports boosted profits and revenues driven by out-of-town store expansion
Shoe Zone has reported boosted profits and revenue driven by the expansion of the budget footwear retailer's 'big box' store format.
The brand said it expects to report a revenue rise of 1.8 per cent to £161m and profit before tax of £11m in its full year results to 29 September.
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The growth has been driven by the roll out of the out-of-town retail park 'big box' stores, of which ten were opened over the year. Six regular stores were opened, however a total of 20 were closed.
An estimated £4m of cash will be distributed as a special dividend to shareholders in March next year, the trading update said.
Shoe Zone chief executive Nick Davis said: “The group has performed well through the year with a particularly strong performance in the second half. Our strategy of growth through big box expansion and online channels allied with excellence in the operations of the core Shoe Zone estate provides us with a clear path for the future. I am particularly pleased that the continued strong cash conversion has enabled the board to outline its intention to propose its third special dividend.
“The new financial year has started well and there are a further 14 big box openings planned. We look forward to updating shareholders on progress at the time of our final results in January.”
Edison Investment Research analyst Paul Hickman said: "Shoe Zone has demonstrated that a closely managed and soundly positioned terrestrially based retail operation can still deliver excellent results. Pre-tax profit for the year to September is flagged as in excess of £11m, growth of 16 per cent, and beating market expectations of £10.1m.
"Management now expects to pay a £4m special dividend as a result of stronger than expected cash generation in the second half."
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