Companies

New CEO at Dr. Martens as the outlook for FY25 worsens

Apr 18, 2024 United Kingdom

The British footwear company has announced that Ije Nwokorie, currently Chief Brand Officer, will succeed Kenny Wilson as CEO, while admitting that the outlook for fiscal 2025 is challenging

As part of an orderly succession plan, Kenny and Ije will work together to ensure a smooth handover, with Ije becoming CEO before the end of the current fiscal year (March 2025). In the meantime, Ije will remain in the role of Chief Brand Officer, focusing on the brand and driving demand ahead of the AW24 season. “Ije is an inspirational leader and his experience in helping drive DTC-led growth at Apple will be highly relevant in the coming years”, Lynne Weedall, Senior Independent Director and Chair of the Nomination Committee, commented.

This news comes after the company confirmed its previously downgraded guidance for fiscal 2024, raising concerns about its future performance.

According to the latest trading update, Dr. Martens’ direct-to-consumer sales picked up in the final quarter of the year, as compared to a 3% decline in the previous quarter, due to a solid performance in EMEA, “very strong” growth in APAC, led by Japan, and a flat result in the US. The wholesale channel also performed in line with expectations.

“There is a wide range of potential outcomes for FY25 given that we have only recently started the year. However, we have assumed that revenue declines by single-digit percentage year-on-year and at the PBT level we could see a worst-case scenario of PBT of around one-third of the FY24 level”, the company reported.

The focus will be on performance in the US, where the wholesale channel continues to struggle, with revenue expected to be down by double digits year-on-year in the current financial year. This should have an impact on profitability, with a baseline assumption of a PBT impact in the region of 20 million British pounds year-on-year.

“The FY25 outlook is challenging, and the whole organisation is focused on our action plan to reignite boots demand, particularly in the USA, our largest market. The nature of USA wholesale is that when customers gain confidence in the market, we will see a significant improvement in our business performance, but we are not assuming that this occurs in FY25”, concluded Kenny Wilson.

Image Credits: gariff.co.uk

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