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Shoe Zone Expects £1m-£2m Pre-Tax Loss as Shares Fall 22% to Five-Year Low
High street retailer Shoe Zone has warned of an annual pre-tax loss, citing the Middle East conflict and recent Budgets as factors increasing customer caution and costs. Shares in the company dropped 22% in morning trading on Wednesday to their lowest level in more than five years. Primark also reported weaker trading in April due to similar pressures.
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High street retailer Shoe Zone warned it expects a pre-tax loss of between £1m and £2m for the year to October 3, blaming the slump in part on war in the Middle East. The company stated that the Iran conflict and recent Budgets have increased customer caution, leading to lower footfall and less discretionary spending.
Shoe Zone, which has 259 stores nationwide in the UK and is headquartered in Leicester, employs about 2,000 people.
The Middle East conflict has led to additional costs such as container prices and transportation costs for Shoe Zone, according to the firm's statements. Shares in Shoe Zone plunged by more than a fifth, falling 22%, in morning trading on Wednesday. The shares fell to their lowest level in more than five years on Wednesday.
Budget clothing chain Primark revealed weaker trading in April, with pressure from the Middle East conflict weighing on shoppers. Primark revealed the information on Tuesday. uk reported these developments, including Shoe Zone's attribution of the slump to macroeconomic factors tied to the Iran war and domestic Budgets.
Shoe Zone added that the conflict and Budgets had impacted shopper confidence, resulting in the anticipated loss. The company operates across the UK with its headquarters in Leicester.
