Dr Martens’ shares are getting a kick after the bootmaker’s latest update

Dr. Martens‘(LSE: Docs) Share price up more than 3% earlier today (27 January) after the company issued a 13-week trading update.

This is even though we are at the top Ftse 250 Legend has it that teamwork over time “As expected“. Encouragingly, he reported that the outlook for the year ending 31 March (FY25) was “unchanged“.

Good progress was reported in the business revolution in the United States. Revenue from direct-to-consumer (DTC) sales was up 4% in constant currency terms, compared to the same period last year.

The region with the highest consumption was Asia Pacific, especially Japan. Overall, the target for Revenue Revenue in the field was 17%, compared to 12 months earlier.

However, in Europe, the Middle East and Africa (EMEA), it fell by 5%. The company said there was a big mistake in several markets that refused to copy.

The devil is in the details

But reporting revenue in constant monetary terms, and focusing on DTC sales, can be unintentionally misleading. Looking at foreign exchange movements and taking into account all types of sales – including those with third parties – the total revenue is 3% lower compared to the same period in 2023.

Using the same ratio, sales in the Americas and Emea were both hit by 4%. But Asia Pacific revenue was higher, albeit at a more modest 6%.

Perhaps this explains why investors have not been very visible in the Group’s team performance. While useful for direct comparisons between periods, removing the effects of currency movements does not reflect reality. International businesses must deal with fluctuating currencies and manage the associated risks. When the company’s FY25 accounts are published later this year, Dr Martens Stutory’s results will have to reflect this.

However, taking into account foreign exchange movements, total revenue across the group was 3% higher. Some of the positives in the statement include the assurance that business continues “Manage our expenses diligently“(Shouldn’t all companies do that?) And that it was”on the track“Decreasing stock levels.

The elephant in the room

But the statement failed to address the company’s biggest issue. Should President Trump continue with his threat (promise?) to impose significant import tariffs on goods brought into the United States from Asia, there will be dire Dr. Martens consequences.

That’s because the group has manufacturing operations in China, Vietnam, Laos and Thailand. This makes it very vulnerable to Trump’s taxes. During FY24, Americans contributed 37% to the revenue.

Although I think that Dr. Martens has lots to take away – a kind of icon that has a global following – I believe that this story is too big to ignore. And I suspect that this uncertainty can be measured in the company’s share price. Even given the speed at which orders for Trumpets are coming in, I don’t think it will be too long before the company (and its longtime shareholders) will know where it stands.

At this time, I will revisit the investment case.