Profit shock gives Shoe Zone’s shares a kicking
ANOTHER day, another profit warning.
The latest victim is budget retailer Shoe Zone, a familiar sight at market towns and city shopping strips across the country.
Its stock nose- dived by more than a third as chief executive Nick Davis abruptly quit alongside an update that its annual profits will be lower than expected and the value of its freehold property portfolio is worth £3.1m less than it thought.
The AIM-listed group expects profits to come in at £9.5m this year, instead of the £11m previously forecast.
Shoe Zone blamed its weaker performance on the wider gloom that has swept through the High Street, with traditional retailers battling to survive amid soaring rents, punitive business rates and stiff competition with online rivals.
Shares closed down 31.3pc, or 60p, at 132p.
The FTSE 100 and mid-cap index the FTSE 250 both closed in the black, putting a close on a turbulent month but relatively calm week. Markets had a roller-coaster mid-August, losing ground as mass-fretting broke out that the world is on the brink of another recession, as well as tracking every sneeze in the US-China trade conflict. This week, the optimism is back, spurred on by signs that Beijing is willing to find a resolution to a spat that has slapped tariffs on hundreds of billions of pounds worth of products.
According to President Trump, who was speaking on Fox News: ‘China wants to make a deal.’
The Footsie had been on track to have its worst month for four years, but instead had its worst month since last October.
The Footsie closed up 0.3pc, or 22.86 points, to 7207.18 points – though it started the month at 7586 – with the FTSE 250 up 0.5pc, or 101.13 points, to 19393.63.
In the latest chapter of a monthslong saga, Ukrainian iron- ore miner Ferrexpo has found that money the company donated to a Ukrainian charity called Blooming Land could have been ‘misappropriated’.
An deep-dive investigation could not explain ‘a number of discrepancies’ in how the charity said it used donations.
An independent committee has concluded that none of Ferrexpo’s staff or directors were involved and added that, under UK listing rules, the charity was not a related party to billionaire boss Kostyantin Zhevago, as he didn’t have any control over its operations.
Investors were bolstered by the news, with shares rising 1.6pc, or 3.15p, to 202.1p.
After plunging on profit warnings on Thursday, stock market bargain hunters went on a share spree, buying up high-interest lender Amigo Holdings and Britain’s biggest IT firm Micro Focus.
Amigo’s stock surged by 12.6pc, or 8.9p, to 79.6p, while Micro Focus’s shares jumped 5.5pc, or 57.4p, to 1108.8p. Heavyweight miners including
Rio Tinto and BHP advanced as nickel prices spiked by 8pc to around $17,700 a tonne.
The value of the metal, which is used to make batteries, has jumped after a waste spill at a plant in Papua New Guinea and an export ban of the raw metal planned by Indonesia sparked fears of a global shortage.
Rio Tinto rose 2.6pc, or 106.5p, to 4149.5p, while BHP gained 2.5pc, or 43p, to 1773p.
Mid-cap builders’ merchant and DIY group Grafton shot up after it announced it would sell its Belgian unit. Growth was strong in its Irish arm, despite being hampered by a ‘softer’ market in the UK, while profits rose 5pc to £91m on revenues of £1.5bn in its halfyear results.
Shares in Grafton rose 10.3pc, or 70p, to 752.5p.