Brand custodian mindset delivering strong results
“I am pleased to be reporting our first results as a publicly listed company. The pandemic presented challenges to our operations and ways of working, and our priority throughout was to keep our people and consumers safe. I am very proud of the resilience, dedication and agility of our teams across the globe. This hard work, together with the investments we continued to make in our brand, resulted in revenue up 15% and EBITDA1 up 22%.
“Our DOCS strategy is delivering strong results. We continue to prioritise selling directly to our consumers, and, with retail severely impacted by Covid-19 restrictions, we focused our efforts on a step-change in ecommerce, achieving revenue growth of 73%, representing 30% of total mix. The investments and improvements we made in our supply chain in recent years, along with our multi-country sourcing model and close supplier relationships allowed us to quickly react to a rapidly changing environment, ensuring minimal disruption and maintaining good availability throughout.
“Our product durability and timeless design are rooted in a sustainable, long-term approach, and our brand custodian philosophy continues to guide the decisions we take. This underpins the financial guidance we laid out at the time of the IPO which is unchanged. Whilst the global trading environment remains uncertain, the strength of our iconic global brand means we look to the future with confidence.” Kenny Wilson, Chief Executive Officer
|£m||FY21||FY20||% change Actual||% change CC4|
|Profit After Tax2||35.7||74.8||(52%)|
|Adjusted1 Diluted EPS3 (p)||11.6||8.6||35%|
|Diluted EPS (p)2||3.6||7.5||(52%)|
|Operating cash flow1||234.1||142.0||65%|
- Before exceptional items of £80.5m (FY20: £12.0m). See pages 75 to 76 for alternative performance measures
- After exceptionals of £80.5m which relate to the IPO
- Normalised Adjusted EPS, excluding legacy funding costs of preference shares, was 14.5p in FY21, as described on page 76
- Constant currency applies the same exchange rate to the FY21 and FY20 non-GBP results, based on FY21 budgeted rates
- Strong growth across all regions. As we expected, revenue grew 17% in both EMEA and Americas, and 7% in APAC. In APAC we saw slower growth in Japan, our largest country in the region, due to the higher physical retail mix which was significantly impacted by Covid-19. China revenue grew by 46%
- DTC mix 43%, down 2%pts driven by:
- Ecommerce revenue up 73%, to 30% mix (up 10%pts)
- Retail impacted by Covid-19 store closures and restrictions, with revenue down 40% and mix at 13%, down 12%pts
- Gross margin grew 1.2%pts to 60.9%, predominantly due to faster delivery of supply chain efficiencies
- EBITDA1 margin grew by 1.6%pts to 29.0%, driven by gross margin performance
- Continued investment in our brand and business, including increasing our headcount by over 250 people, and opening 18 new stores and a third-party distribution centre (DC) in New Jersey USA
- Building on the extensive work to date, we are today announcing the launch of a set of ambitious sustainability targets, including net zero by 2030 and, without compromising quality, all footwear made from sustainable materials by 2040
FY22 and Medium-term financial outlook
The guidance set out at the time of the IPO remains unchanged, for both FY22 and over the medium-term. In FY22 we expect high teens revenue growth year on year, as we lap the Covid-19 impact experienced in FY21. From FY23 and over the medium-term we anticipate mid-teens revenue growth. We are targeting ecommerce to grow to 40% mix, with total DTC, including retail, of 60% mix. Our medium-term target of a 30% EBITDA1 margin is also unchanged. We expect to begin paying a dividend in FY22. Further guidance is provided on page 8. Trading since the year end has been in line with our expectations. We will provide an update on our Q1 trading performance on 29 July 2021.