Jan 11, 2021
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Dr Martens confirms London IPO plan, sales and profits still rising

Jan 11, 2021

Dr Martens Limited confirmed on Monday that its long-awaited IPO will go ahead with a listing plan for the London Stock Exchange as Permira, which controls the firm, sells a stake adding up to around 25% of the firm’s shares. 

Dr Martens

No value estimate was given and the float plan isn’t 100% definite as the British footwear brand is only “considering applying for admission of its ordinary shares to the premium listing segment of the Official List of the FCA and to trading on the main market of the London Stock Exchange”.

But it would take a major crisis to derail the plan and with the biggest crisis to hit the fashion sector in decades having already happened last year, the expectation is that it will happen.

It’s interesting that the firm is planning to list on the LSE’s main market too, as many fashion businesses that float choose to list on the LSE’s alternative investment market (AIM), rather than the more heavily regulated main market.


So what is Dr Martens offering potential investors? The answer to that question is: a company that’s growing fast and looks likely to continue doing so.

The company said that it sells more than 11 million pairs of shoes and boots annually in more than 60 countries. And it had revenues of £672 million in the year to the end of March 2020, plus EBITDA of £184.5 million with an EBITDA margin of 27.4%. 

Importantly too, Dr Martens saw group revenue of £318.2 million in the six months ended September 30 2020, up 18% year-on-year despite the pandemic, with EBITDA up 30% at £86.3 million.

That’s rapid growth in the midst of a global crisis, especially a crisis that saw footwear being one of the fashion categories to be shunned most by locked-down consumers.

The pandemic may have meant some challenges for the firm, but it continued a growth story that has gone on for several years. In the period from FY18 to FY20, for instance, the group achieved revenue compound annual growth (CAGR) of 39% and an EBITDA CAGR of 81%.

This growth has come as it has ramped up its direct-to-consumer strategy that it sees as “crucial for enabling the brand and business to reach their full potential in scale, in a sustainable way”.

The D2C strategy “allows for more direct touchpoints with consumers, better showcase of the footwear and the brand, access to more data, and more controlled and strategic management of the brand,” it said on Monday.

And it also highlighted how strongly the e-commerce channel has performed in recent years and how it expects it “to continue to be the main driver of growth over the coming years”.

In its D2C operation, e-commerce was already close to eclipsing physical stores sales pre-pandemic. In the 12 months to the end of March, D2C made up 45% of total revenues with stores accounting for 25% and e-tail for 20%. In H1 of the current year, e-tail understandably took over and of the 34% of revenue D2C accounted for, e-tail was 24% and physical stores only 11% due to enforced closures and low footfall.

But those figures also make it clear that while D2C is a focus, B2B is still the biggest chunk of its business. In addition to its 130 own stores, its concessions and webstore, it has a thriving wholesale, distributor and franchisee business. In its latest full financial year, the B2B channel made up 55% of revenue. And in the new year’s first half up to the end of September, it made up 66% of revenue.

The company also said that of its three geographical operating units, EMEA made up 43% of sales, the Americas 37% and APAC 20%.


Following the IPO plan announcement, chairman Paul Mason said: “Today marks an important milestone for Dr. Martens and is testament to the skill and hard work of our management team, as we build the business to match the scale and potential of our brand. We have made significant investment in the business over the last few years to strengthen the team, our operations and position ourselves for the next exciting stage of development, as a publicly listed company.”

CEO Kenny Wilson added: “The announcement of our intention to float reflects the great achievements of the Dr Martens team and brand. Even more important is the significant global growth potential for Dr Martens in the future. Our iconic brand appeals to a diverse range of consumers around the world who wear our footwear to express their individual style. We have invested massively to ensure that we deliver the best digital and store experiences to connect with our wearers, and through this we are driving our long-term, sustainable growth.”

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