- Dr Martens is known for his association with various youth subcultures.
- He partly attributed the gloomy outlook to falling wholesale revenues in the US.
Dr. Martens shares plunged on Tuesday after the boot maker revealed a major profit warning and the upcoming departure of its chief executive.
The iconic shoe brand, known for its association with youth subcultures such as mods and punks, said its pre-tax profits could fall by around two-thirds this financial year.
He blamed the gloomy outlook on falling wholesale revenues in the United States, which are expected to fall by double-digit percentage levels, and the anticipation that he will not raise prices to offset cost inflation.
Exit: Boot maker Dr Martens has announced that its chief executive Kenny Wilson (pictured) will step down at the end of this financial year.
Dr Martens expects the first factor to cost it around £20m in profits in the event there are no “significant” new orders during the season from customers, while the second will result in a £35m impact on sales. Profits.
As a result, Dr Martens shares fell 29.9 per cent to 66.55 pence in early trading, making them the biggest faller by far on the FTSE 250 index.
The Northampton-based firm added that its results for the year ending March 2024 would be in line with expectations, thanks to a rebound in direct-to-consumer sales during the fourth quarter.
Kenny Wilson, chief executive of Dr Martens, said: “The entire organization is focused on our action plan to reignite demand for boots, particularly in the US, our largest market.
“The nature of U.S. wholesale is that when customers gain confidence in the market, we will see a significant improvement in the performance of our business.”
Alongside this outlook update, the company revealed that Wilson would step down at the end of this year, having overseen a six-year transformation period at the boot maker.
Wilson joined Dr Martens in May 2018 after a seven-year stint leading floral fashion retailer Cath Kidston, whose intellectual property was acquired by Next last year.
Since taking over, the group’s sales have almost tripled to £1bn as the popularity of its chunky 1460 boots enjoyed a resurgence among a social media-savvy young audience.
Unlike many retailers, it weathered the Covid-19 pandemic quite well despite being forced to temporarily close its UK stores due to tough lockdown restrictions.
In January 2021, Dr Martens listed on the London Stock Exchange at a value of £3.7bn, giving Wilson, many other executives and private equity group Permira a sizeable windfall.
However, Dr Martens shares have fallen around 82 per cent since then due to cost of living pressures, unfavorable weather conditions and supply chain constraints, including operational issues at its Los Angeles distribution centre. Angels.
Wilson’s replacement as chief executive is Ije Nwokorie, who just became brand director of Dr Martens in February and was previously a director at global brand business Wolf Ollins and a senior director at tech giant Apple.
Wilson said: “After six years in office, I feel the time is right for me to step down this year and I am excited that Ije will be my successor.”
“I have enjoyed working with Ije, both as a board member and on the executive leadership team over the past few months, and have seen firsthand his brand knowledge and passion.”