Shoe Zone rallies as it declares special dividend

Shares in Shoe Zone rose on Wednesday as the specialist value footwear retailer declared a special dividend despite “a difficult year” for the industry.

In its results for the 52 weeks ended 3 October, the company said revenue fell 3.5% to £166.8m, reflecting the planned closure of loss-making stores and difficult trading conditions in the first half of 2015.

Pre-tax profit, meanwhile, slipped 3.4% to £10.1m, while earnings per share were flat at 16.2p.

Still, Shoe Zone said that as a result of its performance in the year and strong cash position, it was proposing two dividends to be paid, a final dividend of 6.5p per share, resulting in a total dividend for the year of 9.7p and a special dividend of 6p.

Chief executive Anthony Smith said: “Although 2015 was a difficult year for the footwear industry, we have achieved a solid performance. We have continued our focus on our strategic objectives and this has ensured we are well placed for the future.

“There is extensive work underway to increase the Grade 1 store portfolio and we are targeting an additional 256 stores to be operational by the beginning of February.”

Shoe Zone will be trialling “Project Big Box” in August, which will involve three stores that will be twice the average size of a Grade 1 store.

The stores, which will benefit from an extended product range and higher prices, will allow the group take advantage of the out of town market.

At 0937 GMT, shares in Shoe Zone, which floated on the stock exchange 18 months ago, were up 12.2% to 186.75p.