Bootmaker Dr Martens (DOCS) disappointed investors with its latest trading update which showed it making slow progress. Having set out its new strategy last June, making headway appears to be more of an uphill struggle than the firm had predicted.
| Price: 78.4p -3.9% | P/E: 19x |
| Market Cap: £789m | Yield: 3.0% |
GREEN SHOOTS
Full-price D2C (direct to consumer) sales were up 6% in the six months to the end of September. CEO Ije Nwokorie insisted he was happy with the firm’s advances and saw green shoots across each of its four ‘Levers for Growth’.
However, there remains the thorny issue of tariffs which will represent a high single-digit £m headwind. The firm believes it can offset these, plus currency headwinds of £10 million due to the weak dollar.
Dr Martens has made a big bet on the US market, where sales are rising, so a lot of effort has gone into mitigating the effect of tariffs. It aims to offset half the impact in the FY to March 2026 and all the impact in the FY to March 2027.
Whether the strategy of expanding its product range to include shoes, sandals and bags will be a winner is another matter. If it can pull it off then there could be plenty of upside for the shares, given they have lost over 75% of their value since listing in 2021.
Read the press release here: https://www.drmartensplc.com/investors/
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