Shoe Zone has halved its forecast pre-tax profits, blaming the government's October 2024 budget for hitting customers in the pocket and reducing footfall as a result.
In an update to shareholders this morning, the company cited the continued impact of inflation, interest rates and higher savings rates as reasons for people having less money to spend.
It says those factors have led to a decrease in footfall in its stores and a resultant reduction in revenue and profit.
As a consequence, the footwear firm has slashed its anticipated adjusted pre-tax profit for the year up to September 27 2025 from £5million to £2.5million.
The update posted this morning states: "Shoe Zone announces that for the months of June and July 2025, it experienced challenging trading conditions, principally a further weakening in consumer confidence, which has continued following on from the Governments' October 2024 budget announcement, and we have seen less discretionary spend, with the continued impact of inflation, interest rates and higher savings rates, all of which have decreased footfall, with a resultant reduction in revenue and profit.
"As a result, the Company now expects adjusted profit before tax for the financial year ended 27 September 2025 to be approximately £2.5million, down from previous expectations of £5.0million. In addition, and in light of the above, the Company is withdrawing its current dividend policy.
"Management remain confident with the underlying strategy, with the 200th new format store opening this month. The company remains debt free and confident in our cash management, with cash levels currently higher than the same period last year."
FTSE 100
The UK's flagship share index, the FTSE 100, was up 20 points at 9,179 shortly after opening this morning.
Brent crude oil futures were down 0.02% at $66.03 a barrel.
Companies reporting today
- Balfour Beatty - Half Year Results
- Beazley - Half Year Results
- Hill & Smith - Half Year Results
- Persimmon* - Half Year Results
- TUI* - Q3 Results