Dr Martens blames weak US demand for sales decline

Dr Martens (LSE:DOCS) ended the day flat, despite reporting disappointing sales numbers for its financial year.

In fact, the maker of the iconic boots actually spent much of the London trading session on the front foot.

At £877.1 million, turnover was down 12% on the prior year and the was decline was slightly steeper than the 11% drop forecast by City analysts.

Operating profit was down 30% to £122.2 million, beating the forecasted 34% decline, though profit after tax plummeted 46% to £69.2 million.

Chief executive Kenny Wilson blamed the poor results on weak US consumer demand – evidently, looking at Birkenstock’s soaring performance American fashion presently prefers its footwear toes out.

Dr Martens meanwhile is launching a group-wide cost-cutting plan, targeting up to £25 million of savings. It is also now taking a cleaver to the dividend, with the full-year payout reduced to 2.55p per share from 5.84p last year.

Wilson warned investors that 2025 would be a “transition year”.

“We are clear that we need to drive demand in the USA to return to growth in FY26 onwards and are executing a detailed plan to achieve this, with refocused and increased USA marketing investment in the year ahead," the Dr Martens boss said in a statement.

At 84p after Thursday’s close, Dr Martens is down 4.9% for 2024 to date and is 45% lower over the past 12 months.