Dr Martens swings to H1 loss on weak US demand, higher costs

Pre-tax losses came in at £28.7m for the six months to September, compared with a £25.8m profit a year earlier. Revenue fell 18% to £324.6m.

Outgoing chief executive Kenny Wilson said the company expected to make £25m of cost savings, at the top end of its guidance range. Around two thirds of this figure were job cuts with the majority of people made redundant leaving the business at the end of the first half.

“Our new marketing campaigns are showing encouraging early signs, with strong sales of new product, giving us confidence that we will return USA direct-to-consumer to positive growth in the second half,” Wilson said.

Dr Martens, famed for its chunky-soled lace up boots, introduced a new line of footwear in an attempt to bolster flagging sales in the US, its key market. Sales in the Americas fell 22.3% to £115m driven by weaker footfall at its 60 stores in the region.

The company also introduced foreign exchange impact guidance for the first time and said it expected the remainder of the financial year to be impacted by currency headwinds of around £18m to revenue and £6m to profits.

Reporting by Frank Prenesti for Sharecast.com