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Dr. Martens is a brand of footwear known for its yellow stitching and patented air-cushioned soles. The brand was adopted by British punk rockers in the 1970s, but went mainstream during the grunge movement of the 1990s.
drmartens.com
Shares of Dr. Martens plunged 30% on Tuesday to hit a record low in early deals, after the shoemaker flagged a challenging 2025 outlook on the back of weaker revenues.
Trading in the company shares was temporarily suspended on the London Stock Exchange after the firm issued an unscheduled trading update.
Dr. Martens said it expects its wholesale revenue in the U.S. in 2025 to be down by double-digits year-on-year, given that its order book for autumn and winter — which represents half of the company’s wholesale proceeds in the region — is “significantly” down.
The business assumes revenues in 2025 will decline by a single-digit percentage year-on-year, citing an inability to offet next-year inflation amid no further intentions to increase prices.
“We have built an operating cost base in anticipation of a larger business, however with revenues weaker we are currently seeing significant deleverage through to earnings,” said CEO Kenny Wilson, who will step down in March 2025.
Chief Brand Officer Ije Nwokorie is set to replace him in the top position.
In a Tuesday note, analysts at RBC flagged a negative sentiment on the stock and said that markets would focus on the 2025 guidance in the short term.
See Chart…
Dr Martens share price
This breaking news story is being updated.
— CNBC’s April Roach contributed to this report.
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Read More: Dr. Martens shares plunge to record low, trading halted on weak outlook
2024-04-16 08:42:47
