Bootmaker Dr Martens warns on profit as finance chief walks

Dr Martens issued its third profit warning in five months on Friday, as it struggled with higher-than-expected costs at a new Los Angeles distribution centre.

The British company, whose pricey work boots have been fashionable since the 1960s, also said its chief financial officer Jon Mortimore would leave once it finds a replacement.

Mr Mortimore’s resignation comes as Dr Martens issued its third profit warning since November, when it flagged a sharp hit to profit margins on weaker-than-expected demand before Christmas.

In January, the maker of the clunky 1460 boots with yellow stitching commonly known as “DMs” had flagged lower core profit after struggling with bottleneck issues at its LA distribution centre, affecting its capacity to meet wholesale demand. Shipments from its LA operation were back to normal levels, it said on Friday.

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Shares in Dr Martens, which made its market debut in 2021 with a market capitalisation of $5 billion, were up almost 9 per cent to 154 pence in midafternoon trade in London. They have fallen by nearly two-thirds from their initial public offering price.

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The bootmaker has also been grappling with softer demand in the United States, its second largest market by revenue, with the fourth quarter seeing revenue grow 6 per cent, mainly driven by Europe, Middle East and Africa as well as Asia Pacific.

The London-based firm now expects core profit for the year ending March to be around £245 million (€277 million), down from its earlier forecast of £250 million-£260 million. – Reuters

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