Budget footwear and accessories retailer Shoe Zone had issued a preliminary update for its year to September 2025 last October and the news wasn’t great.

It issued the final figures on Tuesday along with an update for Q1 of its new year, and the news doesn’t get much better.

“Trading conditions remained challenging in the first quarter of the new financial year,” it said, “with revenue down on forecast, reflecting ongoing macroeconomic pressures that continue to weigh on consumer confidence resulting in lower footfall on the UK High Street, alongside the highly adverse Government fiscal policies. The November 2025 budget included an additional increase in the National Living Wage, raising our cost base further, with broader measures not materially improving consumer sentiment. In light of these conditions, we expect a profit before tax of approximately £1m for the financial year ended 3 October 2026”.

The full extent of how bad that £1 million figure will be can be seen from the pre-tax profit of £3.3 million for the year recently ended and £10.1 million for the year before.

But it added that despite the headwinds, the board “remains focused on disciplined cost management and delivering our strategic priorities to ensure resilience and long-term growth, as demonstrated by our strong year-end cash position, which increased by 64% to £5.9 million compared to the prior year. Cash generation is expected to continue into 2026, leaving the business well positioned to capitalise when conditions improve”.

So let’s look at the confirmed figures for the year that ended in September 2025. Revenue fell to £149.1 million from £161.3 million and revenue via its shops dropped to £113.1 million from £126.1 million. Digital revenue edged up to £36 million from £35.2 million. We’ve already mentioned the profit before tax and net cash figures.

The company had 269 stores at the end of the period compared to 297 a year earlier and of these, 201 were larger-format stores compared to 185 the year before. It also said it’s been making savings on annual lease renewals.

Also on the plus side, it said that sales were good last year when there was a reason to buy, such as during the warm summer and the back-to-school period. But overall discretionary spending remain subdued as consumers were cautious even when buying low-priced products.

Another positive is the fact that while total revenue fell by 7.6%, given that the company was trading out of a 9.4% reduction in stores, it’s clear that the strategy of upgrading to larger-format locations is paying off to an extent. 

Meanwhile digital revenues rising 2.3% were supported by improved conversion from its free next-day delivery on all orders via its own site as well as strong sales via Amazon.

The company’s store refit and relocation programme is on track to complete by the end of 2027, at which point its capital expenditure will further reduce, and it will “accelerate our digital strategy, building on recent strong results”.

It plans to invest approximately £4.5 million next year on 23 store projects and Head Office infrastructure changes including IT projects and new vehicles.

And it expects product margins to improve next year, supported by stable container prices over the past six months. It said its buying and shipping teams “are doing an exceptional job of managing the direct-from-factory supply chain, which is still volatile, and we are confident we are performing better than the market average. As we refit existing stores to our larger format, the branded mix will continue to form a higher proportion of our overall sales”.