(Alliance News) - Shoe Zone PLC on Tuesday reported a revenue fall in the first half of its financial year, with the Covid-19 pandemic hurting a promising five months of trading.
In the six months to April 4, revenue fell 5.6% to GBP68.9 million from GBP73.0 million a year prior. Shoe Zone swung to a pretax loss of GBP2.5 million from a GBP1.0 million profit.
The shoe retailer decided against an interim payout, as a result, after last year's 3.5p dividend.
Shoe Zone explained: "The reduction in revenue and profit performance over prior year reflects the early impact of Covid-19. During the period, we experienced both disruption in the supply chain and a fall in consumer spending in March resulting in the subsequent closure of retail stores from March 24. Prior to this, the five months to February showed a year-on-year increase in revenue of 2.6%."
The company added that 416 stores in England, Northern Ireland and the Republic of Ireland have now re-opened. Stores in Wales will open on Sunday, before Shoe Zone lifts its shutters in Scotland on Monday.
Shoe Zone did say however that 20 stores were closed for good during the lockdown, reducing its estate to 470.
"The group has also taken immediate action to reduce costs at head office and pause all areas of discretionary spend. Negotiations with landlords have also been accelerated and supplier orders reduced, cancelled or deferred as far as possible," Shoe Zone said.
A head office renationalisation plan, Shoe Zone noted, meant it incurred GBP300,000 in redundancy costs after the end of the first half.
"Covid-19 will continue to have an unprecedented impact on the UK economy and the retail industry. Whilst the group has taken all possible steps to ensure that the business will survive through the crisis and continue into the future, the impact is likely to continue to be felt for several years," Shoe Zone added.
Shares in the company were 3.7% lower at 84.30p each in London on Tuesday morning.
By Eric Cunha; ericcunha@alliancenews.com
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Shoe Zone (SHOE)