Special dividend plans afoot after Shoe Zone profit haul
SHOE Zone has declared a special dividend on the back of record annual profits and increased revenues despite “a challenging consumer environment”.
The retailer, which specialises in cheap footwear, said pre-tax profits rose 18pc to £11.3m, boosted by its “big box” stores on retail parks. It was the highest annual profit increase since floating in 2014.
Total revenue climbed 1.8pc to £161m in the 52 weeks to Sept 29, with online revenue increasing by almost a fifth to £9.8m.
The 8p special dividend will be on top of a final dividend of 8p, and takes the total payout this year to 19.5p.
In October, the company said that it would distribute an extra £4m of excess cash to shareholders after better-than-expected trading in the second half of the year. Shares jumped 12.3pc to close at 201.5p following the positive results, valuing the company at just over £100m.
Nick Davis, chief executive, said the results were driven by “strong performance throughout the business”.
“This positive performance is testament to the strength of the core business model and the effective focus on growing the ‘big box’ and digital channels. We continue to make good progress against our strategic objectives and the board remains positive about the outlook for the group.”
Later this year the retailer plans to launch its own premium range of ladies’ shoes in a bid to drive margins higher. Its average spend is just £12.98.
Shoe Zone, which sells brands such as Wrangler, Crocs, Skechers and Clarks, has almost 500 stores and about 3,500 employees in the UK.
Sofie Willmott, of GlobalData, said: “A determination to retain a portfolio of this size may come back to haunt Shoe Zone as it seizes online sales opportunities.
“The big-box format has however been a clear winner for Shoe Zone, filling the space left behind by Brantano, and the retailer should be commended for its strategy, as the stores premiumise its offer with the addition of new brands and wider choice.”