Shoe Zone's share price plunged as much as 22% after the retailer reported that it expects to swing to an underlying loss of around £1 million in the full year, compared with profits of £2.4 million the previous year. The group saw revenues slide 4.5% to £142.4 million for the 53 weeks to October 3.
The company blamed a combination of pressures on its financial performance. Chairman Charles Smith said the year had been challenging, particularly in the first half, as consumer confidence remained weak and fell further following the Government's November 2025 budget. He pointed to persistent inflation, elevated interest rates and reduced levels of disposable income as factors that created a negative economic environment for consumers. Sales performed better when there was a clear reason to purchase, such as during the warm summer and Back-To-School season, but overall discretionary spending remained subdued as shoppers exercised greater caution.
Shoe Zone also faced headwinds from its store portfolio. The chain's estate fell to 251 stores at year-end, down from 269 in October 2025, as the company worked to relocate and revamp its retail operations. The group is restructuring its portfolio into newer and bigger formats, with 211 larger format stores and 40 original high street stores, work it aims to complete by the end of 2027. The autumn and winter season had been slower than expected, affecting both the final weeks of its financial year and its first quarter performance.
International pressures also weighed on the retailer's outlook. The Iran war conflict had resulted in higher fuel and transportation costs and pushed up the price of containers used for shipping. Shoe Zone warned investors that recent increases in container prices, a weakening of Sterling against the Dollar and rises in fuel prices could all negatively impact future trading as the company awaits the outcome of the Government's October 2026 Budget.