Dr Martens has experienced a challenging financial period, reporting a significant loss before tax.
- Revenue decreased by 18% to £324.6 million, notably impacted by a 29% drop in wholesale sales.
- A strategic shift has seen the direct-to-consumer division grow to 56.4% of total revenue.
- New refinancing strategy and leadership changes are underway to stabilise the business.
- CEO Kenny Wilson highlights progress towards key objectives amidst preparations for a transition.
Dr Martens has reported a financial loss before tax of £28.7 million for the 26 weeks ending 29 September. This marks a stark contrast to the previous year’s pre-tax profit of £25.8 million, highlighting the retailer’s financial difficulties during this period.
The company’s revenue fell by 18% to £324.6 million due in large part to a steep 29% decline in wholesale sales. Despite this downturn, the direct-to-consumer division has increased its share of total revenue to 56.4%, up from 49.6% the previous year, indicating a strategic shift in focus.
Regionally, all markets are aligned with expectations with revenue declines notable in the EMEA region at 16%, the Americas at 22%, and APAC at 12%. The financial loss was exacerbated by exceptional charges of £9.2 million, primarily related to cost-cutting measures, including a significant reduction in headcount aimed at achieving £25 million in savings by the 2026 fiscal year.
In response to these challenges, Dr Martens has secured a new refinancing deal to replace its existing facilities due to expire in early 2026. This new agreement features a £250 million term loan and a £126.5 million revolving credit facility, with provisions to extend the term up to November 2029 pending lender approval.
Leadership changes are also on the horizon with Ije Nwokorie slated to assume the CEO position on 6 January, following the departure of Kenny Wilson, who will remain until 31 March for a seamless transition. Wilson has stated that the year is about transitioning and reaching critical objectives, such as refocusing marketing efforts, improving the USA direct-to-consumer performance, and fortifying the company’s financial position.
The ongoing financial strategies and leadership transition at Dr Martens are aimed at stabilising the company for future success.
