Dr. Martens H2 2026 Earnings Report

Dr. Martens EPS Results

• Actual EPS: GBX 4.20
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Dr. Martens Revenue Results

• Actual Revenue: $764.90 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Dr. Martens Announcement Details

• Quarter: H2 2026
• Date: 5/19/2026
• Time: Before Market Opens
• Conference Call Date: Tuesday, May 19, 2026
• Conference Call Time: 4:30AM ET

Founded in 1960, Dr. Martens (LON:DOCS) is an iconic British brand with a global presence. “Docs” or “DMs” were originally produced for their durability for workers, before being adopted by diverse youth subcultures and associated musical movements. Today, Dr. Martens has transcended its roots while still celebrating its proud history. It operates in over 60 countries and employs over 3,650 people worldwide. Its operations are split across both Direct-to-Consumer and wholesale channels, and in addition to its world-renowned “1460” boot its product segments span shoes including the 1461 shoe and Adrian loafer, sandals including the Zebzag mule, Kids ranges, as well as a growing line of bags and accessories. The Company successfully listed on the main market of the London Stock Exchange on 29 January 2021 (DOCS.L) and is a constituent of the FTSE 250 index. Dr. Martens operates across three geographic regions: EMEA, Americas and APAC. Our product segments include Originals, Fusion, Kids and Casual and a complementary range of Accessories.

Dr. Martens H2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Adjusted PBT rose 61% to £55.0 million reported, helped by stronger gross margin, tight cost control, and better revenue quality. The company also said net bank debt fell by £25 million, reinforcing balance sheet progress.
• Positive Sentiment: Americas and APAC improved materially, with full-price DTC sales up 14% in the Americas and 15% in APAC. Management said this reflects a successful shift toward higher-quality revenue and less markdown dependence.
• Neutral Sentiment: EMEA remains the main weak spot, with DTC down amid a promotional market and weak consumer backdrop, especially in the U.K. and Germany. Management said completing the full-price pivot there is a key FY2027 focus and will likely create a near-term revenue headwind.
• Positive Sentiment: Wholesale returned to growth for the first time since FY2023, supported by stronger order books for autumn/winter 2026. The company highlighted successful multi-year partnerships with retailers as a driver of that momentum.
• Positive Sentiment: The brand and product pivot is gaining traction, with new families like Lowell, Buzz and Zebzag rising from 3% to 9% of pairs sold, while shoes grew 19% and bags 15%. Dr. Martens also said its organization is now streamlined and its new store formats are delivering higher average selling prices.

Presentation

[Ije Nwokorie, CEO at Dr. Martens]

Welcome everybody to our full year results for FY 2026. I'm joined by Giles Wilson, our CFO, Paul Mason, our Chair. I believe you all know Bethany Barnes, who leads Corporate Communications and Investor Relations. We're also joined by our executive team who are in the room, and they'll be around for conversations afterwards. You can see the agenda on the screen. I will Giles in a minute will come and give us a financial update, and then I will return to talk about our progress on the strategy. The strategy we introduced last year shifts the business from a channel-first mindset to a consumer-first mindset to create more desire for Dr. Martens and the brand around the world. Creating that desire is what Brewer Street is about. We opened this store at 11:00 A.M. on a morning not dissimilar to this one.

[Ije Nwokorie, CEO at Dr. Martens]

It was cold, drizzly, wet, late November. At around 9:00 A.M., even though the store was due to open at 11:00 A.M., we spotted just in that corner an immaculately dressed lady who was just looking into the store. It was obvious she was waiting for the store to open, even though it was 2 hours away. The team gave me a cup of tea from Doctor's Orders to take to her. I let her know that the store wasn't open for another couple of hours. She said, "I know, I am determined to be the first customer in this new store, I'm desperate to get my hands on the Kiki black boot." She stood there, had a cup of tea. At 11:00 A.M., Monique was the first customer in the store.

[Ije Nwokorie, CEO at Dr. Martens]

She got her black Kiki boots in size eight. She walked out with a bounce in her steps. While I can't promise that the CEO of Dr. Martens will make every consumer a cup of tea when they come, what I can promise is that as a team, Liam, the rest of us in this business are obsessed with creating that kind of desire with our consumers around the world. The pivot we've been doing this year is fundamentally about creating that kind of desire, and we're excited to move into a year where we start scaling that around the world. I'll talk a bit more about how we're doing that after Giles takes us through the financial update.

[Giles Wilson, CFO at Dr. Martens]

Need my glasses. Right. Thank you, EJ, and good morning, everyone. As EJ and Liam have said, it's great to welcome you to our Brewer Street beacon store. It's a pleasure to be here and to take you through our full year results for FY 2026. It's been a year of significant change, some really tough calls, and a lot of hard work as we pivot the business to be more consumer-led while continuing to strengthen the core financials building on the work we did last year. As I said at the half year, we've been focused on making the right long-term decisions while staying disciplined on cost in the short term so we can fund them. We've also worked hard to improve the quality of our revenue by driving more full-price sales and reducing markdown.

[Giles Wilson, CFO at Dr. Martens]

Over the next few slides, I'll talk you through some key highlights. Let me turn to the key financials. Before I get into the detail, I want to be clear on how we've treated U.S. tariffs, particularly as companies are approaching this in different ways following the U.S. Supreme Court judgment in February. We've reclassified the full cash amount incurred this year of the unlawful U.S. tariff costs, both from cost of goods and what would have been included in closing inventory as an operating expense, and included that as an adjusting item to show a true performance comparison year-on-year and not to distort future years from these tariffs. We are in the process of reclaiming these, and any refunds received will be recognized also as an adjusting item in future periods.

[Giles Wilson, CFO at Dr. Martens]

All other lawful U.S. tariffs are incurred, are included in cost of goods sold and closing inventory as usual. Right. On revenue, we're in line with guidance, down 1.4% on a constant currency basis. We saw strong gross margin progression, together with our strong cost control, we delivered an adjusted PBT on a constant currency basis of GBP 54.2 million, up 59%, and GBP 55 million on a reported basis, up 61%. We have declared a final dividend of 2.55p in line with last year. Finally, we continue our focus on reducing net debt with net bank debt down a further GBP 25 million. Our overall objective this year was to strengthen the financials and focus on decisions for the long term while delivering significant profit growth.

[Giles Wilson, CFO at Dr. Martens]

Turning to revenue, this bridge shows performance by region and also calls out the full-price D2C performance in each region. The focus this year was on improving revenue quality, not quantity. We delivered that in Americas and APAC. There is work to be done in EMEA. The first column is FY 2025 revenue. The second column adjusts for a one-off U.S. off-price deal completed in Q4 last year. We get a cleaner year-on-year comparison and shows revenue in FY 2026 was essentially flat. Starting with the Americas, we returned to growth across both D2C and wholesale, with total growth adjusted for that off-price deal of GBP 13.3 million. While significantly improving full-price D2C sales, which are up 14%, at the same time as pulling back on markdown. We are particularly pleased with the Americas wholesale. EJ will cover that in more detail later.

[Giles Wilson, CFO at Dr. Martens]

Looking ahead, we expect the wholesale momentum to continue with strong order books for autumn/winter '26. On EMEA, as we talked about through the year, D2C has been tougher with the consumer backdrop weak, and the market has been highly promotional. Overall, D2C was down GBP 24 million year-on-year and full prices back 13%. The brightest spot is wholesale. EMEA wholesale grew by GBP 10 million, and looking forward, the order book is again encouraging. Finally, APAC. D2C delivered continued year-on-year growth with a standout performance in South Korea retail and full-price e-commerce across the whole region. Full price is up 15% and there is a significant year-on-year pullback in markdown. Overall, we're pleased with the progress made in the quality of the revenue.

[Giles Wilson, CFO at Dr. Martens]

Whilst there is still work to be done in EMEA D2C, what gives us confidence is the continued D2C growth in Americas, the strength in APAC, the better wholesale performance and order books, and the progress we've made in reducing reliance on markdown sales. Moving to gross margin, we continue to see a good year-on-year progress with margin up 1.2%. Even with a mix shift from D2C to wholesale, which is slightly lower gross margin channel, creating a 0.2% headwind, the reduced discounting and continued cost control have more than made up for it. Of course, at an EBIT margin level, wholesale performance was a benefit in FY 2026. Less markdown also fed straight through into our average selling price.

[Giles Wilson, CFO at Dr. Martens]

Even with a higher mix of shoes, which has a lower average selling price than boots, overall ASP is still up 0.6%. As we highlighted at the half year, we also delivered a strong COGS outcome with freight savings negotiated by supply chain team as one of the biggest drivers. Turning to underlying EBIT bridge, the first thing to call out is the step up in EBIT margin from 7.7% to 10.4% in FY 2026. As a reminder, one of our medium-term targets is to deliver EBIT margin of mid to high teens, driven by better quality revenue, continued cost control, and operational leverage. This year, you can see the benefit of the first two of these, better quality revenue and cost dis-discipline coming through.

[Giles Wilson, CFO at Dr. Martens]

Now we have the foundations in place to deliver operational leverage as we return to top line growth. In total, adjusted EBIT increased from GBP 60.7 to GBP 78.7, an improvement of 30%. This has been driven by better quality revenue and stronger margin, adding GBP 13.8 million, which was offset by the planned pull back in markdown volume of GBP 12.6 million, OpEx and actions we've taken to reduce costs by GBP 13.8 million. As we said at H1, we've increased brand investment, putting an additional GBP 1 million into demand generation. With fewer store openings and store closures as we execute against the retail strategy, which EJ will update on later, the depreciation is reduced, along with other items delivering a net saving of GBP 4 million. Finally, adjusting items were GBP 24.4 million in total.

[Giles Wilson, CFO at Dr. Martens]

That includes GBP 9.9 million for the full cash cost of the unlawful U.S. tariffs explained earlier, and a number of other adjusting items as set out in the statement. Cash flow and net debt. We've had another strong year here. Over the last two years, the balance sheet has improved significantly. Net debt, bank debt, has come down from a peak of GBP 272 million at half one FY 2024 to just under GBP 70 million at the end of this year. This chart shows the key movements in cash flow-flows in FY 2026, and it also includes the IFRS 16 lease debt to give the overall debt position.

[Giles Wilson, CFO at Dr. Martens]

Net debt reduced from GBP 249.5 million in FY 2025 to GBP 213.5 million, made up of an GBP 11.6 million reduction in leases and GBP 24.4 million in bank debt. We generated GBP 70 million operating cash flow, the first four bars on the chart. We've invested GBP 12 million into CapEx, we've paid GBP 24 million in dividends, and we spent GBP 7 million on the share purchases for the employee benefit trust. Net debt to EBITDA finished at 1.4 times. That's comfortably below our covenant of three times, and it's an improvement of 0.4 times year-on-year. As I promised at the half year, we're now setting out our capital allocation framework.

[Giles Wilson, CFO at Dr. Martens]

Operating cash flow conversion is over 70%, and it's been much higher in recent years as we focused on reducing inventory. After two years in the role, I've got a much clearer view of the cash needs of the business and how cash requirements move through the year. The conclusion I've come to is that a healthy balance sheet is net debt to EBITDA of 1.5x or below throughout the year. That gives us a sensible, prudent covenant headroom and flexibility for what is needed. In terms of how we deploy capital, we think about it in four boxes. They can overlap, and while there's a preferred order, we don't follow them rigidly or by formula. In the first two rows, firstly, we look into invest into the business, into our brand, into CapEx and systems and other value-driving projects.

[Giles Wilson, CFO at Dr. Martens]

We will then look to make a payment of a regular progressive dividend. Our dividend policy is 25%-35% earnings payout, and you will have seen from our past decisions here that we are committed to payment of a dividend. The second row of boxes are more choices for additional capital. Here we look at strategic investment opportunities. By way of example, the investment the business made a few years ago of circa GBP 1 million into the Gen Phoenix Leather Company. Alongside this, when we have excess capital assessed against our leverage requirements, we would also look to return excess cash to shareholders. You will have also seen this morning we announced the second tranche of our share purchase for our employee benefit trust. To wrap up, and before I hand back to EJ, here are the key takeaways.

[Giles Wilson, CFO at Dr. Martens]

We're pleased with the performance this year. We're positioning the business to get back to growth. We've prioritized revenue quality over volume, more full price, less markdown, driven by the USA. We've kept a relentless focus on costs. That has driven cash generation that has strengthened the balance sheet. Net debt has reduced further. We've also invested into the organization and transformation, which EJ will cover next. We've done all that while turning the business to profit growth with adjusted PBT up 61%. With that, I shall hand back to Ije.

[Ije Nwokorie, CEO at Dr. Martens]

Thank you. Well done. Thank you, Giles. You will recognize many of these slides. Let me use them to talk about the progress we're making executing our strategy. First thing to say, we're building on strong foundations here. A much desired global brand, strong financial fundamentals, and significant headroom in markets around the world. The work we've done in the last year has strengthened our control over the business and proved that we can drive revenue quality as we shift growth. Our ambition, it says on that slide, is to be the world's most desired premium footwear brand. We've talked about the four levers that we will use to do that, consumer, product, markets, organization and as I said, I will always update you on those, and I will do that in a moment.

[Ije Nwokorie, CEO at Dr. Martens]

While there's still work to do in the pivot, we are happy with the progress, and we are beginning to scale the things that are ready to be scaled. In some areas, notably organization, the pivot is complete. In other areas, particularly as Giles shared, full price EMEA revenue, the pivot has further to go in FY 2027. Our progress gives us confidence in our medium-term financial targets, which I'll come back to at the end. There is a lot more to go after in this brand. When we announced this strategy a year ago, for each of the levers, we set out very clear objectives, and I'm happy to say that we've delivered on every single one of them. In consumer headlines, we reduced reliance on discounted pairs in Americas wholesale.

[Ije Nwokorie, CEO at Dr. Martens]

In product, we drove sales growth in those new product families that we talked about, and I will touch on them a bit later. In markets, we opened in 9 additional markets through a capital-light market structure. As I'll share later, we have significantly simplified our operating model. We're doing what we said we would do. I'll take each lever in a bit more detail, remind you of our medium-term objective, share the headlines of what we did in FY26, and cover where we still have work to do in the year ahead. When I get to the market section, which is the third of those, I will also do a double-click on retail strategy, as Giles said. First, and as always, I wanna start with the consumer. The consumer lever is about engaging more consumers. That's the goal we've set ourselves.

[Ije Nwokorie, CEO at Dr. Martens]

This includes building great post-purchase experiences, such as the repair and customization that Liam shared and that you can look at downstairs, or the refurbished Dr. Martens offer, we call it ReWair, which grew 73% in the U.S. in FY 2026. The focus for this pivot in FY 2026 was to evolve from a narrow, trend-focused presentation of our brand to one that expresses what matters to more of our wearers: craft, comfort, confidence, with a real focus on the products that we sell. You can see that in this compilation right here. Bring it. Back, back, back, back, back, back, back, back, bring it. Keep it back, back, back, back, back. Look at all this smoke. It is ringing. Back, back, bring it. I think I caught Liam dancing right now.

[Ije Nwokorie, CEO at Dr. Martens]

The focus on craft, comfort, confidence helps us attract a loyal consumer segment. We call them the craft curator, and we talked about that last year. These are less promotionally minded than the style seekers that the brand had previously focused on. The messages that attract them. Things like design, quality, craft, durability have the advantage of being attractive to the other segments. This pivot is helping us engage more consumers and driving high-quality revenue. I'm happy to say that our share of the craft curators in the market, having gone down from FY 2023, is now back up again, and in fact is higher than at any point in which we've kept records. In addition to this, our consumer data platform that we've talked about is helping us land more personalized messages to these different groups.

[Ije Nwokorie, CEO at Dr. Martens]

There's still more to do here, we continue to take benefits from these early advantages. This focus on the right consumer, on the craft curator, and this ability to reach consumers with what really matters to them beyond just a deal is helping us drive this full price growth and revenue quality. You can see the results here, and Gilles has talked to some of them. In USDTC, again, full price revenue was up 14%. In APAC, full price revenue in our DTC was up 15%. It's not just in our DTC. We reduced off-price US wholesale by about a third. As a result, the average selling price in US wholesale is up 23%. Where we still have work to do is in EMEA. As you can see here, EMEA DTC full price revenue was down.

[Ije Nwokorie, CEO at Dr. Martens]

A heavily promotional market in the second half and the absence of stronger local executional muscle in EMEA meant that we went backwards, particularly in U.K. and Germany. This is a big area of focus for us in the year ahead, and we have a strong playbook because we've done this in other markets, and now we have the market-level leadership to deliver improved results in FY 2027. For the consumer lever, as we think about the year ahead, we will complete the pivot by driving that full price mix in the U.K. and Germany, where we had the biggest declines in FY 2026. Completing this pivot to full high-quality revenue in our markets is the critical final component of this pivot. In the short term, it will create a revenue headwind, but it will improve revenue quality and give us a better basis for profitable growth.

[Ije Nwokorie, CEO at Dr. Martens]

In terms of what we will scale, as we look across our markets, this focus on the craft curator is working. We will be investing another-- up to another 100 basis points in the brand to reach more consumers. When we've done that, and as we go through that and we get to the half, we'll come back and tell you how we are using that investment. That's consumer. Let me talk about product. I'll give you an update on the new product families that we've talked about and that were at the heart of our pivot in FY 2026. Before I do that, I want to say that's not all we did. We reinforced our premium.

[Ije Nwokorie, CEO at Dr. Martens]

For example, the Rick Owens collection, which is that product up there, which sells at between GBP 340 to GBP 390, depending on the silhouette. Across our products, while the GBP 220-plus segment is our smallest segment, it is our fastest-growing segment. As I've said before, this brand can command an even higher premium. To the new product families and how they help us drive more purchase occasions. Lowell, which you see right here, Buzz, and Zebzag were all successful. Their contribution to the business went from 3% to 9% of pairs in FY 2026. The craft curators loves Lowell, but that's not all we did. Buzz continues to give wearers a uniquely Doc's fashion-led option. We have some of it in the back of the place here.

[Ije Nwokorie, CEO at Dr. Martens]

Zebzag, which you can see here, meets that everyday comfort need with its lightweight, easy-on design. Importantly, we gained 4% on comfort versus the competition based on our brand health index between October 2024 and October 2025. We'll make sure that comfort is even more closely associated with the Dr. Martens brand as we grow. Now, let me take the product categories one by one, starting maybe obviously with shoes. Shoe revenue is up 19% in the year as we focused on engaging more consumers with a wider range of our products, as I told you last year. It's not only Lowell and Buzz. It's some of our longer-established core products that are doing this. The 1461 shoe, the Mary Jane that's right there, the Adrian Tassel Loafer have all done very well for us.

[Ije Nwokorie, CEO at Dr. Martens]

Shoes is not a single product story, and the growth was across all our markets, led by the Americas, where shoes were up 32% in revenue. Boots saw a decline of 8% in FY 2026, but we are beginning to see green shoots, especially in the U.S., where full-price boots and our core 1460 boot were backing growth. The Kasey boot pictured here was actually the number one product of all products in USDTC in FY 2026. We're excited about where we can take boots next. Sandals requires a bigger reset, as I've previously shared, with performance down 11% in FY 2026. While we've had successful lines like the Zebzag Dunnet Slide that you see here, sandals recovery will not start in earnest until spring/summer 2027. Growth will be driven by an innovative program that delivers on lightweight and comfort.

[Ije Nwokorie, CEO at Dr. Martens]

Early pre-reads from our partners are very encouraging. From late FY 2027 and into FY 2028, we expect to begin to deliver that sandals growth. With bags, the growth is already coming. Revenue grew 15% in FY 2026. This is from a small base, but bags is an important growth category, as I said last year, and it was encouraging to see the success in the first year of the strategy in bags. Looking to FY 2027, we aim to make progress across all product categories. To complete the pivot, we will focus on full-price boots. As I said, we're beginning to see that turn, and we will focus on making sure that we deliver that full-price boots performance. We will introduce a new standards program towards the end of the financial year. We'll continue to scale what's already working.

[Ije Nwokorie, CEO at Dr. Martens]

We will continue the momentum in shoes across price points, and we will build on our early success in Bags, particularly getting into more of our wholesale partners around the world. Next is market, where we've made good progress partnering great multi-brand retailers around the world. This picture here is a wonderful partnership we have in South Korea with our partner there called MUSINSA, where they present the 1461 shoe in such a wonderful way. A few of us managed to see that, and it's really inspiring to see. It's a powerful presentation of our brand, and I'll say more about how those partnerships work in a moment. As a reminder, our key objective that we said was to open in at least 1 market with a capital-light model.

[Ije Nwokorie, CEO at Dr. Martens]

I'm thrilled to say that we are now trading in Argentina, Chile, Colombia, Costa Rica, Mexico, Paraguay, Peru, Uruguay, and UAE. All markets we were not in a year ago. We've also accelerated this model in markets that we're already in, like the Philippines. Even in markets where we have a DTC offering, like China and Italy, there are parts of the market where this is a great way to go, and we have also extended our presence in those places with similar capital-light models. The thing I wanna spend a bit of time talking about is our focus on multi-year relationships with multi-brand retailers. The headline here is that this is not just about distribution. This is about creating value together.

[Ije Nwokorie, CEO at Dr. Martens]

When you work with the right retailers who themselves are amazing curators of great products and great stories for their consumers, the amplified effect is powerful for both parties. We bring an iconic brand, crafted product, unique stories, which is their raw material. They bring incredible reach, a discovery engine for consumers, for diverse consumers, cross-sell opportunities, and rich consumer insight. The result is these great experiences that I shared with the MUSINSA example, but great experiences for the customer, which in turn create value for all parties. It's the right way to partner, and we've begun to see those results bear fruit in FY 2026. Two examples illustrate this from two partners that we have. Both partners an offering in FY 2025, if you look at those assortments.

[Ije Nwokorie, CEO at Dr. Martens]

In FY 2026, we worked closely with them on multi-year plans to tailor the assortment to their consumers. Partner A remains rooted in core boots with newness coming through. That's what their consumer wants. Partner B has shifted, as you can see in the graph here, to an assortment that aligns much more to the fashion-forward consumer. It's shoes, it's brown footwear, not as much black, but all of it 100% Dr. Martens. As a result, both partners experienced growth in FY 2026, and the FY 2027 order books reflect that differentiation is driving continued growth. That's the power of this approach. By focusing on the consumer and giving them the assortment and the products they want, you drive growth.

[Ije Nwokorie, CEO at Dr. Martens]

Of course, that result bears out, as Giles has said, that wholesale is back to growth in FY 2026 for the first time since FY 2023. I should flag that, as Giles did, that that American wholesale figure has been adjusted to exclude a large, one-off wholesale deal, off-price deal, so this chart shows underlying performance. You can see the sizable decline, particularly in the Americas in FY 2024 and 25, is reversed as we return to growth in FY 2026. Again, as Giles has said, we're encouraged by the order books and these multi-year plans, and they give us confidence that we'll continue to grow wholesale in FY 2027 and the years ahead. As I promised, let me now dive a bit into the retail strategy, which is another key part of how we show up in the market.

[Ije Nwokorie, CEO at Dr. Martens]

Between FY 2021 and FY 2024, our store estate doubled from about 122 stores to 239 stores. Retail revenue only grew 50%. Every store was essentially the same, whether it was in a college town on the East Coast or in one of Tokyo's fashion-led streets. In FY 2026, in our comprehensive review that we looked at, we've aligned on a segmented estate to drive brand desire and customer engagement by having the right kind of store for the right kind of experience for the consumer. In FY 2026, as part of that, we introduced two new formats. You're sitting in one of them right now. Brewer Street here in London is our Beacon concept.

[Ije Nwokorie, CEO at Dr. Martens]

The store has an average selling price of about 15% higher than other London stores, even though to create this kind of experience, it has about 60% less SKUs than the other stores in London. The cafe, the weekly events program that the team puts on, the repair center, they really make this a beacon for our brand. People come, they hang out, they engage more deeply with Dr. Martens, and it's an important concept for us to have. On the right is our brand center concept or format, which we've introduced in Dosan Park in Seoul. It's a step down from the Beacon, but it's also a new retail model that we're really excited about. Just two months in, average selling prices here are 20% higher than the average store in South Korea.

[Ije Nwokorie, CEO at Dr. Martens]

Bag sales are two and a half times what they are in typical stores because we really display the entire assortment. Again, you have a cafe, a customization center, a craft zone. A cafe there which is provided by a partner actually, again, that partnership comes together. Consumers are able to come in and get the full range of experience from the Dr. Martens brand. If you take those two new models, the beacon and the brand center, and you combine them with the rest of the estate, the vast majority of our stores, you begin to get a differentiated estate. The beacons will be about 5% of our stores, immersive brand destinations. The brand centers will be about 10% of our stores, destinations to explore the full range of the brand.

[Ije Nwokorie, CEO at Dr. Martens]

The brand stores, the core offering elevated, will be about 70%. We have our brand outlets which offer an accessible entry to the brand at value, will be about 15% of our stores. These percentages are illustrative of where we're heading over the next three to five years. I wanna make clear that the vast majority of our stores are already brand stores, this third concept, which means that we do not need significant capital expenditure to get there. The estate at that level is already pretty much fit for purpose. For markets, to summarize, in FY 2027, completing the pivot will be about launching these new retail concepts in key cities around the world. There is much more that we can do for our consumer in this area. We also have things to scale because they're already working.

[Ije Nwokorie, CEO at Dr. Martens]

We will use our learnings from FY 2026 to upgrade 30 high-potential stores to become brand centers, so similar to Dosan Park, over the next two years. We'll continue to scale the low capital model that we talked about and that we've opened in new markets in the year ahead, and we will open more doors with great multi-brand retailers using that same partnering and mutual value creation approach in the year ahead. As we do that, we'll come and share that back. Finally, organization, and I'll keep this short. Our goal is to simplify the operating model, optimize the cost base, and build a culture of excellence, care, and importantly, accountability. The first thing we've done is to streamline the executive team from 12 to eight and build a team that blends deep institutional knowledge with an external perspective.

[Ije Nwokorie, CEO at Dr. Martens]

They're all in the room today, and I hope you get to meet them again. Mike and Anna are here, who've been in the company for the best part of a decade, and if you cut them, they bleed Dr. Martens. Giles, Bridget, and Kathryn joined about two years ago, and they've been at the ground floor of the pivot that we've been engineering. Then in the last year, Carla and Paul have joined us, even though it feels like they've been with us forever. They're all here today, and we're excited to operate as one executive team. We've also simplified our operating model, effectively removing the regional layer between the center and the markets. It created distance from our consumer and led to duplication of functions across the organization. You had product, marketing, technology, HR, and so on replicated across each region.

[Ije Nwokorie, CEO at Dr. Martens]

We've strengthened the group functions, giving us global centers of excellence in product, marketing, customer experience, supply chain, technology, finance, and HR. We've empowered experienced commercial teams in our biggest markets, led by general managers, or in the case of our biggest market, the U.S., led by Paul Zadoff himself. The result is a leaner, more agile structure with the dual strengths of strong brand direction from the center and genuine consumer connection in each market, focused on delivering what the consumer desires. This change is what unlocks everything I've talked about today, because proximity to the consumer is at the heart of why we will win. Before I wrap up, a few words on the last organizational enabler, technology.

[Ije Nwokorie, CEO at Dr. Martens]

Over the last few years, Dr. Martens has invested in a strong technology platform, and in the year since we last spoke, we've built out our Global Technology Center, called GTC, in Bangalore with a smart and experienced team of engineers and data technologists. You can see some of them here. Actually, Giles and I are in this picture, and there'll be prizes for whoever can spot us. This is now impacting how our supply and demand planning system give us more control. It's helping embed AI and advanced analytics into people's everyday work, and it powers the consumer-first mindset. How we attract high-quality consumers, how we deliver consistent personalized experiences, and how we drive repeat purchases or reactivate those who may have gone somewhere else for a while.

[Ije Nwokorie, CEO at Dr. Martens]

A year in, we're encouraged, I'll be honest, we're excited and thrilled by the impact they have. There's much more to come. The organizational pivot is, in effect, done. Leadership in place, structure executed, and enabling technology embedded. In the year ahead, the focus is on scaling what works. I look forward to coming back in the half and sharing with you the benefits we're reaping from this operating model and how technology's unlocking benefits for the entire business. I'll wrap up. I hope I've given you a sense of what we've been up to. In FY 2026, we did what we said we would do across all our growth levers. In FY 2027, we have set similarly clear objectives for you to judge us by. In consumer, our primary goal is to drive full price revenue mix in U.K. and DACH.

[Ije Nwokorie, CEO at Dr. Martens]

We have done this in the U.S. and APAC, and we will do it here. In product, our goal is to successfully introduce an innovative new sandals range. Innovation is at the heart of this organization, and executing that in the year ahead is a critical focus. In markets, we'll launch new retail concepts in key cities around the world, and we'll come back and share those. In the organization, as I just said, it's about unlocking the operating model and technology benefits. We set these objectives because transparency matters to us. You should be able to judge our progress clearly, and when we next speak, we'll tell you how we're getting on on each one of them. Finally, let me come back to what this is all about for all of us: value creation.

[Ije Nwokorie, CEO at Dr. Martens]

As I've said, ours is a much desired, iconic global brand with significant headroom to grow and the advantage of attractive British roots and heritage that I can personally tell you resonates around the world. We're leveraging this brand, our strong financial fundamentals, and the operational control that we've implemented to move towards our medium-term objectives, which I'll remind you of again. Profitable revenue growth above the rate of the relevant footwear market. Operational leverage going to mid to high teens EBIT margin. You can see that we've started moving in that direction from 7.7% to 10.4%. All underpinned by strong cash generation. The truth is that this is only possible because of the talent and passion and commitment of our people.

[Ije Nwokorie, CEO at Dr. Martens]

It's an honor to lead them, and I am grateful for the great work they do every day. Jas and I will now sit down and take your questions. If you're asking a question, there's some mics going around. Please start with your name, where you're from, and we'd be glad to take those questions, and eventually, we'll take some questions from the calls there as well. Thank you.

[John Stevenson, Research Analyst at Peel Hunt]

Morning. John Stevenson of Peel Hunt. Two questions, or at least sort of discussion areas, I guess. First one on EMEA. You've sort of talked about, you know, the very tough backdrop. You also alluded to areas where you can execute better. Can you sort of dig a bit more into that in terms of, you know, how you're executing in the market and what you sort of intend to do about EMEA?

[Ije Nwokorie, CEO at Dr. Martens]

Yeah.

[John Stevenson, Research Analyst at Peel Hunt]

Second question was on the sort of store refresh. Again, can you talk a little bit about the detail behind it? It sounds like, are we gonna need new sites for the brand and sort of beacon centers, or actually can they come from the existing estate? How much do you intend to sort of spend in terms of CapEx? You know, what's going into outlet as well would be quite interesting.

[Ije Nwokorie, CEO at Dr. Martens]

What's going into?

[John Stevenson, Research Analyst at Peel Hunt]

into outlet.

[John Stevenson, Research Analyst at Peel Hunt]

Are you actually producing for outlet yet?

[Ije Nwokorie, CEO at Dr. Martens]

Thank you. I'll take both questions. On execution, it's about leadership. Execution is always about leadership. The big change is that we now have general managers. These are senior leaders in our business who are now responsible for markets. That's their 100% of their job to execute. That's the fundamental change from before. In the past, we had channel leaders. There was nobody who was responsible waking up every day thinking, "How do I grow the German market?" Now we have those leaders in place. That's the fundamental unlock. These are all experienced multi-channel leaders in our industry who can drive that. That's the answer to that. We'll probably share the store question. Let me talk about Beacon and outlet.

[Giles Wilson, CFO at Dr. Martens]

Yeah.

[Ije Nwokorie, CEO at Dr. Martens]

You'll talk about investment. As we said, we're not planning to launch a whole bunch of Beacons. It's about in the next three to five years, it's about 5% of our estate. Yes, I think the Beacons will be new locations, but that's not a big part of the plan here. In terms of outlets, no, we do not make for outlets. Outlets are a really great way though to give the consumer an entry point. Sometimes it's about a product that has ended the season, and we're really now ready to offer that at a profitable discount through an outlet. It also helps us keep most of our other channels clean and focused on full price. We are not manufacturing for outlets. You want to talk about.

[Giles Wilson, CFO at Dr. Martens]

In terms of CapEx, I think you've seen the guidance in the notes. We expect to do most of these, the 30 stores which we reference our existing stores, so they will be more about upgrading those. There'll always be closures and openings in the year, but we talk about the next couple of years being probably broadly flat on the number of stores we have in the portfolio. What you will notice also just while on CapEx, we have highlighted that we've got both of our, what was our mayor office and our head office, leases have come to an end. We're doing an office move. There's some CapEx we put into the guidance, which included within the numbers this year.

[John Stevenson, Research Analyst at Peel Hunt]

Thank you.

[Ije Nwokorie, CEO at Dr. Martens]

Thank you.

[Anne Critchlow, Analyst at Berenberg]

Thanks. It's Anne Critchlow from Berenberg. You talked about the 1460 boot being back in growth. I'm just wondering if you're seeing any sign that fashion trends might be moving back towards boots, and can we expect growth in boots maybe next year or year after? I don't know. Secondly, I'm just wondering if you could comment a bit about your wholesale order books, because you've got a bit of forward view there. I think in your statement, you talked about operating leverage and strong profit growth. Clearly expecting top-line growth. Wondering what's informing your confidence there. Thank you.

[Ije Nwokorie, CEO at Dr. Martens]

Yep. Full price boots, the green sheet I spoke to, just to be clear on that, is full price boots growth in the U.S., and in the fourth quarter, the 1460 growth in the U.S. Look, I think the overall trend and decline in boots has flattened. I don't see that boots as a category are yet in growth. We have a ton of opportunity. Didn't know that was going to happen. I haven't been told of a test. If that happens again, we might have to orderly exit. That's not about external trends, when we look at our business and our ability to present great boot offerings, we still have a ton of potential.

[Ije Nwokorie, CEO at Dr. Martens]

Our guidance for the year ahead is that we're gonna focus on full price boots and drive performance in that while the market recovers in boots.

[Kate Calvert, Equity Analyst, Retail at Investec]

Morning. I'm Kate Calvert from Investec. Can I just come back to John's question on EMEA?

[Ije Nwokorie, CEO at Dr. Martens]

Sorry, I don't think we answered all your questions.

[Kate Calvert, Equity Analyst, Retail at Investec]

Oh, sorry.

[Ije Nwokorie, CEO at Dr. Martens]

Sorry. We only answered one of them. Sorry. Apologies. Sorry.

[Giles Wilson, CFO at Dr. Martens]

I've written it to say we'd catch up.

[Ije Nwokorie, CEO at Dr. Martens]

Sorry, Kate. Sorry to interrupt you, Kate. Wholesale order books? You wanna talk about wholesale order books?

[Giles Wilson, CFO at Dr. Martens]

Yeah

[Ije Nwokorie, CEO at Dr. Martens]

operational leverage?

[Giles Wilson, CFO at Dr. Martens]

Yeah, as we said in the statement and in both EJ and I referenced, we're seeing good look forward to autumn/winter 2026. EJ just commented on some of the early signs on spring/summer 2027. Absolutely, I talked about it in my statement that, you know, we've put the foundations in place on cost control, we've put the foundations in on quality of revenue. We're now in the position, the cost base is in the right place, to see profit growth will come through operational leverage. What we can control, we feel in a good place on. Obviously, there is macroeconomics that we make very clear in the statement that we can't control.

[Giles Wilson, CFO at Dr. Martens]

What we can control, we feel that we're in a good place to go forward and start to grow the top line.

[Kate Calvert, Equity Analyst, Retail at Investec]

Me again. Just coming back to John's question on EMEA, and obviously the change to being more sort of country managed. Can you sort of bring alive an example perhaps in terms of how your approach to pivoting the U.K. and Germany, how it might be different, given the different nuances in the market?

[Ije Nwokorie, CEO at Dr. Martens]

Okay, yeah. That's a great question. The markets are different in many ways. What is common to the U.K. and Germany at the moment is that the consumer is often looking for a deal. That's a reality of the consumer. The U.S. consumer has been more resilient than the U.K. and German consumer. That's base fact. That's real. The color that we have though, when you take a market-led approach, is that you can go to where the consumer is, you're not trying to make retail do what eCom can do or what the wholesaler is better to do. It allows you, as I said earlier, to put the right assortment in front of the right consumer.

[Ije Nwokorie, CEO at Dr. Martens]

The consumer that's coming into your retail, you can have a bit more of a full price offering versus the consumer who might be going into a wholesaler who might have a discount going on. It's really about understanding all the levers that you're pulling around the consumer. That's the power of this model. The playbook we have from the year that's gone by shows us that when we do present that full price offering to the consumer, as I said, there is a revenue headwind because you don't get that clearance. With the right offering, our consumers have proven, in all markets, that they will pay a higher price. That's why the GBP 220+ range is doing really well. That's why full price boots can get back into growth.

[Ije Nwokorie, CEO at Dr. Martens]

It's really about making sure that we have the market level discipline as opposed to a distant channel discipline to present the right offering to the consumer, and they are empowered to make those calls at a market level. Yeah.

[Kate Calvert, Equity Analyst, Retail at Investec]

My second question is, can you give us an idea as how far along your journey you are to increase full price sales across the business?

[Ije Nwokorie, CEO at Dr. Martens]

Oh, I understand your question. I think you got to look at that at a market by market level, Kate. I'm really happy with what we've done in the U.S. I'm really happy with what we've done in Asia. As I've said, the thing to focus on as we chat over the next few months and quarters is how are we achieving that in the U.K. and Germany.

[Kate Calvert, Equity Analyst, Retail at Investec]

Okay, thanks.

[Piral Dadhania, Analyst at RBC Capital Markets]

Thank you. Piral Dadhania from RBC. thanks for the presentation. Could you just help us understand from a pricing perspective, how you're thinking about FY 2027? Obviously, raw materials are going up because of oil prices. What should we think about in terms of the price contribution to revenues? I'll ask my other questions after that if that's all right.

[Giles Wilson, CFO at Dr. Martens]

Can we take that?

[Ije Nwokorie, CEO at Dr. Martens]

Yeah, let's take it because that's a supply chain question really, and it's, so if I may.

[Giles Wilson, CFO at Dr. Martens]

Pricing, if you remember, after three years, we took some price earlier in the U.S. We also took some tactical pricing across Europe and other parts of the world. At the moment, we have no planned price increases. We'll always review what the opportunities are. We're in line with our pricing policy, so we don't comment on overall, but we have a pricing policy that we review. In terms of raw materials, we have sort of certainty over the next cycle. We negotiate those on an annual basis.

[Giles Wilson, CFO at Dr. Martens]

We're not seeing any real material movements at the moment, and actually, when you break down the various components, you've gotta get to the point where actually the oil makes it. The one call I would say, which I'm sure you're hearing from lots of people, will be there will be potentially some fuel surcharges coming through on freight. We'd expect to manage that within the overall cost base.

[Piral Dadhania, Analyst at RBC Capital Markets]

Thank you, Giles.

[Giles Wilson, CFO at Dr. Martens]

Just to finish up, because I think it's important. Pricing is about what's right for the consumer, and we feel really confident that we will only make those calls when we see a consumer opportunity. We can manage the cost issues.

[Piral Dadhania, Analyst at RBC Capital Markets]

Thank you. Just on those systems in investments that you've made in the last few years, could you help us understand what the contribution has been to 26 in terms of demand forecasting and I think Microsoft Dynamics or other things, and what we can expect for 27? Will that be an accelerator to the way that you execute?

[Giles Wilson, CFO at Dr. Martens]

Yes. It will be an accelerator to the way we execute, but it's not something I'm going to quantify that it gives us X amount uplift. It's all part of the tools that our people use to run the business. I can tell you that it's a key component of your ability to drive full price. The more you know what the consumer is motivated by, the more likely you are to present them an offer that motivates them that isn't about price. The reason you often depend on price, because you don't really know what else to motivate the consumer with, it will help us drive that. It's not something that we would, that we would quantify in a financial value.

[Piral Dadhania, Analyst at RBC Capital Markets]

Okay. Just one more. As you think about moving towards a mid-to-high teens EBIT margin, right? I think your gross margin's already at sort of peak levels, should we say. Is it fair to assume that all of that additional EBIT margin expansion just comes from operating leverage by holding your OpEx cost stable, as close to stable as possible?

[Giles Wilson, CFO at Dr. Martens]

Effectively, yes.

[Piral Dadhania, Analyst at RBC Capital Markets]

Yeah. Okay. Thank you.

[Ije Nwokorie, CEO at Dr. Martens]

If there are no more in the room, we'll take some from the phone.

[Operator]

Thank you. We'll take a question from Adrien Duverger from Goldman Sachs.

[Adrien Duverger, Goldman Sachs]

Hey, thank you very much for taking my questions. I think most of mine have already been asked. But maybe just a couple. Maybe one on discounting. How would you describe your current promotional environment across markets, and where do you see most concern or where do you see your greatest opportunity? The second question would be on the Middle East implications. Have you noticed any changes in spending patterns in recent months, maybe like in Europe or in the U.S. and across, like, I mean different end markets? Thank you very much.

[Ije Nwokorie, CEO at Dr. Martens]

I'll take the discounting question.

[Ije Nwokorie, CEO at Dr. Martens]

Middle East. I think I've said it, Adrien. It's really in the U.K. and Germany that we need to buck a discounting trend. That's really where our focus is. We've done the work in most other markets. U.K. and Germany are really important markets for us, and so that's the completion of the pivot is in those markets. They are heavily promotional markets. You don't have things like MAP pricing that you have in the U.S. that allows you to control a bit of the pricing. It's work we have to do, but that's where that work is. In the rest of the world, I'm fairly comfortable with where we are on discounting.

[Ije Nwokorie, CEO at Dr. Martens]

Yeah. In terms of the Middle East implications, I mean, obviously, we have a very small business, actually a business just starting itself in the Middle East. In terms of sort of current trading, obviously period one's a small period for us anyway. We always make that statement. But the key for me, which I think is when we look forward, is the strength of those order books, and I think that's the real focus that we're looking at. At the moment, that's the one we keep an eye on, and we're not seeing any changes to those.

[Ije Nwokorie, CEO at Dr. Martens]

I think that's all we have. I don't have a big close. I think we've said a lot this morning. Thank you all for coming. A few of us are still around, so really happy to meet and catch up. Thank you for coming, and enjoy the rest of your day.

Participants

Executives

• Giles Wilson, CFO
• Ije Nwokorie, CEO

Analysts

• Adrien Duverger, Goldman Sachs
• Anne Critchlow, Analyst at Berenberg
• John Stevenson, Research Analyst at Peel Hunt
• Kate Calvert, Equity Analyst, Retail at Investec
• Piral Dadhania, Analyst at RBC Capital Markets