Footasylum swings to a loss despite improved revenues

(Sharecast News) - Shoe retailer Footasylum assured that current trading was in line with rebased expectations, after the profit warning last month.The company said revenues grew across all channels and major product categories in the first half of its trading year, despite challenging trading conditions experienced all along the high street.Revenues improved 19% to £98.6m but the chain swung to a £4m pre-tax loss from the £2.3m pre-tax profit seen a year earlier, as gross margins were squeezed by extensive investments aimed at future growth.Directors assured investors that the company was currently trading in line with its rebased expectations - with store revenues up 12% to £66.3m and online sales and wholesale revenues improving 29% to £30.2m and 200% to £2.1m, respectively.Executive chairman Barry Bown, said: "This has been a difficult trading period for Footasylum as we have contended with tough conditions on the high street and some delays in our programme of new store openings and upsizes ahead of the peak trading period.""We are encouraged by the early results and trends that we are seeing from our investments in key areas such as digital and marketing, and see substantial opportunity for further progress across these and other parts of our operations."Last month Footasylum shares tanked after the company warned that adjusted earnings for the year will be "significantly lower" than previous guidance.Footasylum also expected to report a small LBITDA for the period due to a lower gross margin and higher costs from investment in the company's operations. In addition, it anticipates more than £2m of exceptional income from the early termination of the lease one of its Birmingham stores.As of 0825 BST, Footasylum shares had sunk 6.92% to 30.25p.