- Full-year guidance confirmed
- Americas back in growth
- Investors remain sceptical
Iconic footwear brand Dr Martens (DOCS) confirmed its 2025 outlook and said third quarter trading was in line with expectations, with US DTC (direct to consumer) revenue returning back to growth.
Early signs of a turnaround at the US business were not enough to impress investors as the shares fell around 3% to 70.3p, after initially opening in the green.
Shares in the FTSE 250 company are down nearly 20% over the last year compared with a 6% gain in the midcap index.
WHAT DID THE COMPANY SAY?
CEO Ije Nwokorie commented: ‘I am excited to be CEO of Dr Martens. The global relevance of our iconic brand, the strength of our product line and the passionate commitment of our team give me great confidence for FY25 and beyond.
‘We have made good progress against our objective of turning around our USA performance, with USA DTC in positive growth in Q3. We continue to actively manage our costs and are on track to meet our inventory reduction target for FY25. The team and I are squarely focused on returning the business to sustainable and profitable growth.’
Third quarter group revenue in constant currencies was up 3% to £267 million, comprised of 1% growth in DTC and a 9% increased in wholesale. The company said it is on track to meet its objective of returning Americas DTC back to growth in the second half after third quarter revenue increased by 4%.
Elsewhere, EMEA (Europe, Middle East, and Africa) saw the weakest performance with revenue down by 5% year-on-year, while the Asia-Pacific region was the strongest with revenue up 17% in constant currencies, driven by ecommerce.
EXPERT VIEW
Russ Mould, AJ Bell investment director, commented: ‘The seller of iconic footwear made a start to life as a public company as if it had its shoelaces tied together. Its latest statement is a case of one step forward, two steps back.
‘While this statement is not a total disaster it will be unlikely to win over many sceptics. Dr Martens still has a big job on its hands to rebuild its credibility with the market.’
Disclaimer: Financial services company AJ Bell referenced in the article owns Shares magazine. The editor (Martin Gamble) and the editor (James Crux) own shares in AJ Bell.
