Dr Martens has suffered a decline in profits despite delivering double-digit sales growth, as it ramps up investment in new stores, marketing and people.

Kenny Wilson

Kenny Wilson said ‘at the heart of our continued success is the strength of our brand’

The footwear specialist posted a 5% fall in pre-tax profit to £57.9m during the six months to September 30.

EBITDA was flat year on year at £88.8m, while revenue rose 13% to £418.6m. 

Dr Martens said sales growth was delivered across all of its channels. Direct-to-consumer sales jumped 21% to £179.8m – ecommerce sales were up 8% and stores surged 38%, driven by the opening of 21 new shops during the six months. Wholesale revenue climbed 15% to £238.8m. 

Top-line gains were led by Dr Martens’ US business, which racked up a 31% spike in underlying revenue to £179.7m.   

Dr Martens said capital expenditure during the half-year came in at £19.3m – almost double the £10.1m it spent during the same period 12 months ago – as it also invested in IT and the fit-out of a new warehouse in the Netherlands. It now expects full-year profit margins to be 100 to 250 basis points lower than last year.   

The retailer and brand said although consumer demand “weakened” during its first half and DTC sales were “slower than anticipated” during its second quarter, it was maintaining its full-year revenue guidance of “high-teens growth”. 

It also insisted that, despite the turbulent macroeconomic backdrop, it would press on with its strategy of “targeted investment for the future, rather than reducing investment for short-term profit”.

Chief executive Kenny Wilson said: “At the heart of our continued success is the strength of our brand, highlighted by underlying pairs growth and continually improving brand metrics. We have further pricing headroom for autumn/winter 2023 so we will offset cost inflation once again.

“Although there are economic challenges ahead, we are well positioned for future growth. We will continue to drive growth investment to deliver the DOCS strategy, mainly in new stores, marketing, people, technology and inventory.”

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