Shoe Zone experienced a sharp decline in its stock value this morning (2 July) after issuing a profit warning citing elevated shipping expenses impacting its profitability for the year.
The company stated that it faced rising costs related to container prices caused by a decrease in the availability of shipping vessels. It further explained that in combination with the diversion away from the Suez Canal amidst ongoing Red Sea disturbances, container prices have surged significantly in the past six months.
Consequently, Shoe Zone anticipates that its adjusted pre-tax profit for the year ending 2 October will not be below £10m.
Following the disclosure, Shoe Zone’s shares plummeted nearly 19% from 152p to 124p at the stock market opening.
The company also reported lower-than-expected sales during the spring and summer months from April to June, attributed to adverse weather conditions.
Recently, Shoe Zone disclosed being targeted by a cyber attack, resulting in unauthorized access to certain online systems and data.
Upon detecting the breach, the company promptly enacted its IT security measures to block the unauthorized access. Shoe Zone mentioned that it does not anticipate any significant financial repercussions stemming from the incident.
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