TOP NEWS: Dr Martens profit down as listing costs offset revenue hike

(Alliance News) - Dr Martens PLC on Thursday reported a double-digit revenue hike, but a sharp ...

Alliance News 17 June, 2021 | 8:48AM
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(Alliance News) - Dr Martens PLC on Thursday reported a double-digit revenue hike, but a sharp profit fall due to listing costs, in its maiden yearly results since its float at the start of the year.

The boot maker left its guidance unchanged and promised to pay a dividend. It expects "high teens revenue growth" for the new year, but then tips this to slow to a hike in the "mid-teens" range the following year.

The stock was down 9.4% at 448.40 pence each in London on Thursday morning, the worst performing mid-cap stock. The stock had debuted in early February at 370p, so remains up 21%.

In the year ended March 31, Dr Martens posted revenue of GBP773.0 million, up 15% from GBP672.2 million. However, pretax profit declined 52% to GBP35.7 million from GBP74.8 million.

The company said it was hit with GBP80.5 million in exceptional costs relating to its initial public offering. The boot maker raised GBP1.30 billion in its IPO, giving it a GBP3.70 billion market capitalisation on admission and subsequent inclusion in the FTSE 250 index.

On an adjusted basis, pretax profit rose 34% to GBP151.4 million from GBP113.0 million.

Dr Martens saw annual e-commerce revenue rise 73% to GBP235.4 million, though retail revenue dropped 40% to GBP99.7 million, amid Covid-19 lockdowns. The company said it sold 12.7 million pairs of its iconic boots during the period, up 14% from 11.1 million. Dr Martens noted "strong growth across all regions".

The company said: "As we expected, revenue grew 17% in both EMEA and Americas, and 7% in APAC. In APAC we saw slower growth in Japan, our largest country in the region, due to the higher physical retail mix which was significantly impacted by Covid-19. China revenue grew by 46%."

Looking ahead, Dr Martens left its guidance unchanged for both the current year and in the medium term.

"In FY22 we expect high teens revenue growth year-on-year, as we lap the Covid-19 impact experienced in FY21. From FY23 and over the medium-term we anticipate mid-teens revenue growth. We are targeting e-commerce to grow to 40% mix," Dr Martens added.

Its medium-term earnings before interest, tax, depreciation and amortisation margin target of 30% was also retained. Its Ebitda margin improved 1.6 percentage points to 29.0% in the year ended March.

Dr Martens expects to begin paying dividends during the current financial, it said. The new year's trading has been "in line with our expectations" so far.

By Eric Cunha; ericcunha@alliancenews.com

Copyright 2021 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Dr. Martens PLC Ordinary Shares 433.00 GBX -1.59 -

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