Discount retailer Shoe Zone has said it expects its full-year sales to fall as it carries out its programme of closing loss-making stores.

The Leicester-based firm said in an update that despite strong trading in the second half of the year, it expects annual sales will be 3.5 per cent lower at around £166.8 million in the year to October 3 compared to a year ago.

It said the loss is in line with expectations as it cuts loss-making outlets from its current 535-store portfolio.

The business said it closed 28 shops in the period, and opened 18 stores as it reorders its estate.

Analysts at Numis said: "We expect the store portfolio strategy, falling rental costs and product range development to deliver steady profit growth over the next couple of years."

Shares lifted almost six per cent.

Earlier in the year the retailer issued a profits warning due to the ''material impact'' of mild weather on sales.

In April it said its average selling prices fell in the first half of the year as products such as ladies ankle boots were favoured over higher priced long leg boots.

The company, which was founded by brothers Michael and Christopher Smith in 1980, joined the stock market last May valued at £80 million.

Shoe Zone claims it sells 20 million pairs of shoes per year, and in 2013 said its average retail price for a pair of shoes was £9.77. The business employs around 4,100 staff in the UK and Ireland.