Shares in Dr Martens (DOCS.L) have surged by 25% after the footwear group reported a jump in profits and raised its guidance on revenue growth for next year as it shrugs off inflation.
The iconic boot brand saw sales jump 18% to £908.3m ($1.1bn) with profits up 43% to £214m as it shrugged off inflation and oil price pressures.
The company, founded in Northamptonshire, said it expects “high teens” revenue growth in 2023 as a result of price increases.
It will open between 25 and 35 more shops on top of the 24 opened this year, which took the total store estate to 158.
Chief executive Kenny Wilson said: “When we listed, we committed to deliver high-teens revenue growth, and today we are pleased to report 22% constant currency growth and EBITDA ahead of market expectations. Our results were achieved against unprecedented COVID-19 disruption in our supply chain, which our teams navigated with flexibility and dedication.
“Our recent comprehensive brand survey shows that our brand is stronger than ever, with significant growth in awareness, familiarity and recent purchase. Dr Martens remains incredibly underpenetrated globally, giving us conviction in our future growth ambition.”
Shares in the boot company jumped 25% in early morning trading to 272p. The company floated last year at 370p a share.
The group's two largest regions, Americas and EMEA (Europe, Middle East and Africa) generated revenue gains of 29% and 19% respectively, while Asia Pacific was down 10% amid ongoing COVID-19 restrictions in China and other countries.
The company sold 14.1 million pairs of boots and shoes, twice as many as four years ago, with traditional styles, such as the 1460 boot, making up the “lion’s share” of sales. The company also announced that the company's 3000 staff will be awarded bonus pay outs.
The wholesale order book is already confirmed at 85% of full year expectations, and factory prices for the coming year are locked in, with a 6% increase year-on-year.
The board is proposing a final dividend of 4.28p, taking the total dividend to 5.50p. This brings the total payout ratio to 30%, from 25% in respect of the interim payout.