TIDMSHOE
RNS Number : 8634O
Shoe Zone PLC
13 October 2021
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. It forms part of United Kingdom
domestic law by virtue of the European Union (Withdrawal) Act 2018.
Upon the publication of this announcement, this inside information
is now considered to be in the public domain.
Shoe Zone plc
("Shoe Zone" or the "Company")
Full Year Trading Update
Shoe Zone is pleased to announce its unaudited full year trading
update for the 52 weeks to 2 October 2021 ("FY 2021").
Financial Highlights:
-- Total group revenue of GBP119.1m (FY 2020: GBP122.6m, FY 2019: GBP162.0m)
-- Stores traded for approximately 36 weeks due to mandatory
Government closures (FY 2020: 41 weeks, FY 2019: 52 weeks)
o Digital revenue of GBP30.6m (FY 2020: GBP19.3m, FY 2019:
GBP10.6m) increase of 58.5% on FY 2020 and 188.7% increase on FY
2019 and now representing 25.7% of revenue (FY 2020: 15.7%, FY
2019: 6.5%)
-- Gross product margin of c.61.3% (FY 2020: 61.4%, FY 2019: 62.7%)
-- Net cash balance of GBP14.2m (FY 2020: GBP6.3m)
-- Profit before tax expected to be not less than GBP6.5m
-- Store numbers: 410 (FY 2020: 460)
Financial Summary
Revenue
In the 52 weeks to 2 October 2021 total revenue was GBP119.1m
(FY 2020: GBP122.6m, FY 2019: GBP162.0m) This was impacted by the
COVID pandemic mainly in the first half of the year as stores were
closed for 16 weeks. All stores were open and fully trading as at
the end of April 2021 which enabled us to trade over our key 'Back
to School' period.
Digital revenue stood at GBP30.6m (FY 2020: GBP19.3, FY 2019:
GBP10.6m) an increase of 58.5% on FY 2020 and a 188.7% increase on
FY 2019. The FY 2021 total represents 25.7% of overall revenue (FY
2020: 15.7% FY 2019: 6.5%). This is as a result of our digital
investment and will be the core of our strategy going forward.
Margins
Gross product margin slightly decreased to 61.3% (FY 2020:
61.4%, FY 2019: 62.7%). Underlying Shoe Zone product margins were
ahead of last year but the overall blended margin is lower than
expected due to the proportion of branded product being sold
through our Big Box / Hybrid formats and digital channels. This is
despite increasing container prices and raw material costs and has
been helped by the streamlining of the number of styles we sell
which enables better cost prices and improved markdown control.
PBT
Profit before tax is expected to be not less than GBP6.5m. Shoe
Zone has traded positively during the period the UK was not subject
to Government mandated lockdowns and particularly over our key Back
to School period. This positive trading, alongside the significant
cost reduction action taken in 2020 and the Government support
schemes Shoe Zone has utilised, has enabled the business to move
quickly back into profitability.
Cash
The Company ended the period with a balance sheet cash balance
of GBP19.0m (FY 2020: GBP13.3m). We intend to pay off the
outstanding balance of GBP4.8m of the Coronavirus Large Business
Interruption Loan ("CLBIL") by the end of the next financial year,
enabling us to have the ability to restart dividend payments
earlier than previously anticipated. The net cash balance excluding
the CLBIL is GBP14.2m at the period end (FY 2020: GBP6.3m). The
increased cash balance is due to the cash preservation actions
taken throughout FY 2021 and FY 2020 which included no capital
expenditure, significant overhead reduction, strict stock
management and no dividend payments. The year-end cash position is
overstated mainly due to the delay of new season stock arrivals
caused by container and shipping issues. These would normally have
been paid for in September and will now be paid later. We estimate
this is approximately GBP2.5m at cost.
Store numbers
We ended the year trading out of 410 stores (FY 2020: 460). This
is made up of 343 original Shoe Zone stores, 51 Big Box and 16
Hybrid stores. We will continue our strategy to expand the number
of Big Box and Hybrid formats through relocations or refits of
existing Shoe Zone stores. We will also continue to reduce the
number of original Shoe Zone stores that are no longer commercially
viable.
Chief Executive Update, Anthony Smith
Shoe Zone has weathered an intensely challenging year due to the
COVID-19 pandemic. The negative impact of this has been largely
mitigated due to quick action taken in areas we could control, by
reducing costs, continuing and accelerating investment in our
digital business and improving operations. As a result, we have
emerged as a leaner, stronger and more resilient business.
These are a solid set of preliminary results but there is still
uncertainty ahead of us in the next 12 months, not only with the
continuing impact of COVID, but also the challenges we face with
the global supply chain and inflationary pressures. We have seen a
minimum of a five-fold increase in container prices over the last
12 months and this will continue to impact us for at least a
further six months until the issues being experienced in the whole
supply chain return to more sensible levels.
Strategy
The decision to invest in our digital infrastructure and
operations has led to significant growth in online sales over the
last 12 months, giving us the confidence to make this the core of
our business strategy going forward. We will continue to invest in
our people and our shoehub(R) platform. We aim to increase drop
ship partners, market places, exclusive products, brands and plan
to introduce additional payment and delivery options to enhance
customer experience.
Part of the success of our digital operation is our very
efficient returns process, complemented by our extensive network of
stores. Our physical store network is critical to our future
success even though digital will be at the core of our strategy
going forward. We have seen over the last 18 months a reduction in
store numbers as we have exited poor performing locations. We will
continue to rollout our successful 'Big Box' and 'Hybrid' formats
by targeting key towns for conversion or relocation. Our ultimate
goal is a doubling of Big Box locations to approximately 100 and an
increase in Hybrid stores from 15 to approximately 150. Overall, we
anticipate trading from a similar sales square footage, albeit from
a reduced number of locations.
As part of the changes we have made during the pandemic, planned
capital expenditure was reduced to conserve cash. However, we have
already restarted store relocations, refits, infrastructure changes
at our head office and further investment in digital. All of these
areas are key to our strategy going forward and we will commit to
spending c.3% of turnover annually on capital projects.
Finally, I would like to thank all of our Shoe Zone team for
their amazing support and commitment over the last 18 months.
People form a key part of our business success, even more so as we
look forward to the next generation of our strategy. We will
continue to invest in our team by increasing training and career
development plans, offering more qualification sponsorship and
enhancing our graduate programme.
For further information please call:
Shoe Zone PLC Tel: +44 (0) 116 222 3000
Anthony Smith (Chief Executive)
Terry Boot (Finance Director)
Zeus Capital (Nominated Advisor and Broker) Tel: +44 (0) 203 829
5000
Daniel Harris, James Hornigold (Corporate Finance)
Dominic King (Corporate Broking)
About Shoe Zone
Shoe Zone is a Town Centre, Retail Park and Digital footwear
retailer, offering low price and high quality footwear for the
whole family.
Shoe Zone operates from a portfolio of 410 stores and has
approximately 2,850 employees across the UK.
The store portfolio consists of 343 high street stores
containing the core Shoe Zone product range and 16 hybrid high
street stores and 51 larger Retail Park stores which also have
additional brands such as Skechers, Hush Puppies and Kickers.
Shoezone.com, combined with the store network, ensures a full
multi-channel offering for great customer service.
During an average year Shoe Zone sells 17 million pairs of shoes
per annum at an average retail price of GBP10.47.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
TSTGZMMGRZMGMZM
(END) Dow Jones Newswires
October 13, 2021 02:00 ET (06:00 GMT)
Shoe Zone (LSE:SHOE)
Gráfica de Acción Histórica
De Abr 2024 a May 2024
Shoe Zone (LSE:SHOE)
Gráfica de Acción Histórica
De May 2023 a May 2024
