Schuh delivers record profts of £25.6m

A Schuh store on Edinburgh's Frederick Street. Picture: TSPL

The Livingston-based company, which was bought out by Nashville shoe giant Genesco two years ago for £100 million, yesterday reported a pre-tax profit of £25.6m for the year to January 2013.

It said sales of £233m were 18 per cent higher compared to the previous year on a like-for-like basis. The firm’s previous accounting period was just 44 weeks as it adjusted its financial timetable following the take-over.

Schuh opened 16 stores last year including its first foray into children’s footwear, with three specialist kids’ shops. Since the year end, it has opened another three outlets, taking its total estate to 92.

A further eight property deals have been signed and openings lined up over the coming months should take the chain into triple figures. The brand was founded as a single shop in Edinburgh’s North Bridge Arcade in 1981.

Finance director Mark Crutchley, who alongside managing director Colin Temple led a management buy-out of the business in 2004, said performance in the second year of Genesco ownership had flourished.

He said: “We have focused on making our customers’ life easier with the introduction of a tablet-optimised website and services such as live video chat and check-and-reserve, and our results show that these have resonated well with the customers.”

With a young clientele that wants a shopping experience and uses the latest mobile gadgets to follow fashion and seek out the latest deals, Schuh has “acknowledged the decline” in traditional desktop computer use.

The firm noticed that a substantial number of customers were accessing their site via tablets, and as these users are an attractive group to “tap into” – their spend tends to be higher and sales conversion rates are far superior to those using smartphones – it therefore decided to focus its online efforts on giving “the best tablet experience possible”.

Last Christmas Schuh launched a fully optimised tablet site, making a calculated decision to achieve a larger market share. Built by the firm’s in house team, it already accounts for 17 per cent of the group’s UK traffic and delivered sales of more than £1m in the first nine weeks after launch.

Schuh said the tablet site is merely the first stage in the redesign of its whole online offering.

Since the takeover, Schuh has become a stand out performer for Genesco, beating figures at its Journeys arm. Growth at the Scottish business increases the chance of a bonus of up to £25m for members of the management team in 2015, thanks to a clause in the takeover relating to performance over the four years following the deal.

Temple and Crutchley shared £37m of their 2011 windfall with staff and donated £7m to a new charitable foundation.