Shoe Zone raises profit guidance again as summer and BtS prove strong
Trading updates seem to be coming on a monthly basis from value footwear retailer Shoe Zone these days and after updates in May, June and July, it managed one on the last day of August too. And the news was once again good.
After having raised its profit guidance a month ago, on Wednesday it said that since the publication of that update, “trading has continued to exceed expectations due to continued strong demand for summer and back-to-school products throughout August”.
Summer has clearly been helped by the hot weather in the UK and the return to consumers going on holiday. Meanwhile, the back-to-school period is usually a key selling season for budget footwear retailers and with the current cost-of-living crisis, that seems to be even more the case this year as consumers seek maximum value from their purchases.
And that seems to be helping Shoe Zone whose low-priced offer is perfectly pitched for the trying times shoppers are facing at present.
Not that a focus on low prices is hurting margins. The company said it also continues to “benefit from the margin improvements as outlined in recent trading updates”.
As a result, it expects adjusted profit before tax for the financial year ending 2 October to be no less than £10.5 million. A month ago it had said no less than £9.5 million and just weeks before that £8.5 million.
The company is clearly expecting a good autumn season and perhaps with justification. The boots season could be hugely challenging for higher-priced brands with boots being among the most expensive purchases for footwear shoppers. Shoe Zone’s pricing could once again resonate with them.
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