Shares in the owner of Hotter Shoes have slumped after warning its losses are now expected to be higher than previously forecast.
Skelmersdale-headquartered Unbound Group said that “despite a cautionary outlook at the group’s interim results, trading conditions in the second half of the financial year have been more challenging”.
It added that “several external factors, including the extended period of hot weather, the impact of Royal Mail industrial action and broader economic conditions significantly impacted sales of our autumn/winter range in the final five months of the year”.
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As a result, the group said its full-year revenue is now expected to be between £53 and £54m, 3% to 4% growth on the prior year.
It also now expects to incur an adjusted pre-tax loss of between £4.25m and £4.75m.
Those figures are below the current consensus market expectations for the year to February 5, 2023, which are for a revenue of £57.7m and an adjusted pre-tax loss of £1.2m.
After releasing the figures to the London Stock Exchange, shares in the group slumped by around 40%.
Chief executive Ian Watson said: “Since our strong start to the year, trading in the second half has been disappointing, with weakened demand from the current economic slowdown and a number of external factors.
“However, we are pleased that margin discipline was maintained.
“Our core brand Hotter retains a highly loyal and engaged customer base.
“We will focus on a broader product range, driven by our insight into our customer’s needs, attitudes and behaviours. In reaction to the challenging trading environment, our strategic focus is centred around growth and simplification.
“The group will also generate significant annualised cost savings which will be fully implemented by the end of October 2023.
“As we continue to navigate our way through the current challenging consumer backdrop, I remain confident in the long-term future of Hotter and the wider Unbound platform as we build strategic partnerships with brands who want to partner with us to target our group’s key demographic.”
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