Iconic Northamptonshire bootwear brand Dr Martens says it is paying back £1.3m claimed under the government's furlough scheme despite annual profits taking a hit.
According to the Wollaston-based company's annual report, released today (June 17), annual sales in the year to March 31 jumped 15 per cent to £773m, fuelled by a rise in online business and a 46 per cent surge in revenue in China.
Pre-tax profits were down 30 per cent to £70.9m, although all of that was linked to costs of £80.5m associated with the 120-year-old company's stock market listing in January.
Most of the initial public offering costs were due to a £49.1m bonus paid out to staff.
In the UK, Dr Martens shut three of its retail stores, leaving 34 in total, but said trading was strong enough to be able to pay back the furlough cash.
Chief executive Kenny Wilson said: “At the point I joined we were doing eight per cent of our sales online, so we made a conscious decision three years ago to heavily invest in digital.
“People buy their first pair of Dr Martens in their late teens or early 20s. Those consumers have grown up in a world where digital is the norm, so our strategy has been for a long time to build the digital capabilities of business.
“When the pandemic actually hit, we were ready and we were able to drive more of our demand to online.
“Within three months we could see the strength of Dr Martens.com and we realised that we could pay all of our employees in full without taking Government support.
“At the board, myself and CFO said we believe we should repay the money and it just felt like the right thing to do.”
Looking forward, Mr Wilson said he expects to see a continuation of the shift to online, although not at the same growth levels.
He told the Independent: “We keep telling our organisation that this will not be a straight line return to business as usual and normality, and I think we expect there will be challenges in different countries around the world. I don’t think anybody truly knows yet what’s going to happen with the pandemic.”
Dr Martens was founded by the Griggs family making work boots in Northamptonshire in 1901 but became a fashion icon after adopting its Airwair brand in the 1960s.
The Griggs family sold the brand in 2014 to the Permira investment group which retained its Wollaston HQ.