Dr Martens lowers his forecast and loses more than 20% in London

The brand announced Thursday sales worse than expected for its staggered third quarter. Simon Newman/REUTERS

This fall comes from direct sales in the United States “weaker than expected, in part due to exceptionally hot weather for the season”, according to the general manager.

British shoe brand Dr. Martens, whose performance in recent months has been weighed down by the global economic crisis, plunged more than 20% in London after disappointing results and lowered forecasts. The company facessignificant operational issues creating a bottleneck in (its) new distribution center“of Los Angeles and direct sales in the United States”weaker than expected, partly due to unseasonably warm weather“, points out Kenny Wilson, the general manager.

As a result, the brand on Thursday announced worse-than-expected sales for its staggered third quarter, which ended at the end of December, at 335.9 million pounds, and revised down its sales forecast for its full financial year ( it should grow by 11 to 13%). The action plunged 21.89% to 163.40 pence on Thursday around 0900 GMT on the London Stock Exchange. Dr. Martens, a brand founded in 1960 and inseparable from the punk movement, had published fivefold annual results for its last financial year, but it is caught up in the deterioration of the economic climate, with the United Kingdom in particular projected into recession next year and faced with inflation of more than 10%.

“Consumer confidence has weakened”

The brand of famous orthopedic shoes with thick rubber soles had seen its net profit fall year on year for its first half, and warned that “consumer confidence has weakened“, which had already made it plunge on the London Stock Exchange. “Dr Martens has been caught up in operational issues at its new distribution center in Los Angeles” and “this is another big headache for the company, which was already facing disappointing sales” in the USA, “considered a key market for the company’s growth“, Estimates Susannah Streeter, analyst of Hargreaves Lansdown.

The group is now focusing on direct sales to consumers, especially online, in order to be less dependent on resellers, who still represent the majority of results, and hoped to see its sales boosted by Christmas. But if “sales improved in America in December“that was not enough to”offset weaker performance in October and November“, further indicated the company in its press release.

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