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Dr Martens chief to exit as shares hit record low after profit warning

<span>Dr Martens issued four profit warnings last year.</span><span>Photograph: Dr Martens/PA</span>
Dr Martens issued four profit warnings last year.Photograph: Dr Martens/PA

Shares in Dr Martens plummeted to a new low as the UK bootmaker warned on profits and poor performance in the US, and announced the departure of its chief executive.

The brand, known for its yellow-stitched thick-soled boots, warned sales would fall by a single-digit percentage in the year to the end of March 2025, compared with a year earlier. Profit before tax could be just a third of last year’s £159m in a worst-case scenario.

It was the latest in a string of profit warnings at the brand, which issued four last year, and prompted the shares to plunge by a third on Tuesday to a record low of 62p.

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The company expects US wholesale revenues (for shoes sold via other retailers in their stores) to fall in double digits, explaining that its autumn/winter order book, which makes up most of the second half of its US sales, is significantly down year on year. This will result in a £20m hit to pre-tax profits, with a further £35m hit from cost pressures, including wage bills.

“We do not anticipate increasing prices further this year, and therefore this year we are unable to offset cost inflation as we have in prior years,” Dr Martens said.

Analysts at Peel Hunt said the warning was not a surprise, “but the scale of the impact is much greater than feared”.

The chief executive, Kenny Wilson, who has spent six years at the helm, is to leave at the end of the financial year and will be replaced by Ije Nwokorie, who has served as chief brand officer in the past year, and previously worked as a senior director at Apple Retail.

Wilson described the outlook as “challenging”, adding: “The whole organisation is focused on our action plan to reignite boots demand, particularly in the US, our largest market. The nature of US wholesale is that when customers gain confidence in the market we will see a significant improvement in our business performance, but we are not assuming that this occurs in the [current] financial year.”

The boots were first created in 1945 by a young German army doctor, Klaus Märtens, who designed an air-cushioned sole to help his recovery from a broken foot. They made their debut in Britain in 1960 when a Northamptonshire footwear maker started producing them. Their sturdy design made them popular among postal delivery workers and factory staff, and was later embraced by skinheads and punks. These days, Dr Martens is a mainstream bootmaker.