With Dr Martens PLC (LSE:DOCS) shares down around 80% over the past two year, the latest reason being a larger-than-expected profit warning in November, there has not been much signs of investor confidence ahead of a trading update on Thursdy 25 January.
When we last heard from them, management of the bootmaker warned that full-year earnings would be below expectations as a hoped-for recovery in the US did not materialise fast enough.
Full-year 2023 revenue was predicted to therefore decline by a high single-digit percentage compared to 2022 and EBITDA to be “moderately below” the bottom end of consensus forecasts (ie below £224 million), with pre-tax profit also impacted by around £5 million higher net finance costs.
City forecasts are expecting revenue to be down 10%, with EBITDA down 16% at around £205 million.
Guidance from management implied that second half revenues will be down 9-13%, said broker Peel Hunt, and that early indications for the Autumn/Winter 2024 order book "also likely to be well down" after a challenging trading period.
"We expect Christmas trading to have remained tough, albeit the recent cold weather is likely to have been more helpful," the broker added.
"As such, we would expect the 3Q trading update to do little more than confirm November’s downgrades."
The shares fell to a new all-time low around 90p after the November profit warning and have since plumbed new depths, sinking below 74p in the week before the festive update.