Birkenstock Holding plc exceeded its full guidance for the fiscal year ended September 30, with results said to be driven by “continued strong and growing consumer demand for its products across all segments, channels and categories.”

Fourth Quarter Summary
Birkenstock reported revenue of €456 million in the quarter, an increase of 22 percent year-over-year (y/y) on both a reported and constant-currency (cc) basis.

The company reported strong double-digit revenue growth across all segments, including 21 percent y/y growth in the Americas, 19 percent y/y growth in Europe, and a 38 percent y/y increase in the APMA region on a constant-currency basis.

Direct-to-consumer (DTC) revenue was up 18 percent y/y and Wholesale (B2B) revenue growth was 26 percent y/y on a constant-currency basis.

Gross profit margin amounted to 59.0 percent of sales in the fourth quarter, down 640 basis points from 65.4 percent in the fourth quarter of 2023. The company reported that the prior-year quarter was impacted by several non-cash, true-up adjustments and the reclassification of certain logistics expenses, which, combined, elevated the Q4 2023 gross margin by approximately 450 basis points. The remaining 190 basis-point decline in gross margin was said to be the result of the expected under-absorption impact from added production capacity, the increase in B2B share relative to a year ago, and currency translation impacts, partially offset by pricing.

Net profit amounted to €52 million, or €0.28 per share, in the third quarter, compared to a net loss of €28 million, or a loss of €0.15 in the year-ago Q4 period.

Adjusted Net profit was €55 million, or €0.29 per share, compared to €25 million, or Adjusted EPS of €0.14, in the 2023 fourth quarter.

Adjusted EBITDA of €125 million was up 31 percent y/y, and Adjusted EBITDA margin of 27.4 percent of sales was up 190 basis points y/y from 25.5 percent in Q4 last year.

Full Year Summary
The company reported that fiscal 2024 revenue growth of 21 percent to €1.8 billion on a reported basis and increased 22 percent on a constant-currency basis for the full fiscal year ended September 30, exceeding the company’s guidance of 20 percent.

Pair growth for the fiscal year was 14 percent in fiscal 2024, supported by the new production capacity added in fiscal 2024. Average Selling Price (ASP) grew 8 percent on a constant-currency basis, supported by product mix and targeted price actions. ASP benefited from increased sales of closed-toe silhouettes, which grew over twice the group average and closed-toe share of business increased to approximately one-third.

DTC revenue grew 21 percent y/y on a constant-currency basis in fiscal 2024, resulting in a DTC penetration rate of approximately 40 percent of total sales, consistent with last year. The company opened 20 new-owned retail stores, bringing the total number to 67.

B2B revenue grew 23 percent on a constant-currency basis y/y as wholesale demand, supported by strong sell-through, reportedly remained “very high.”

“Over 90 percent of B2B growth came from within existing doors as key retail partners continue to expand the breadth and depth of their Birkenstock offerings to meet growing consumer demand,” the company said in a media release.

In the Americas, Birkenstock said it delivered constant-currency revenue growth of 19 percent in fiscal 2024, supported by continued growth in both the B2B and DTC channels. The company reported B2B growth was robust and strengthened into year-end as key wholesale partners allocated more space to support meaningful 250-year anniversary displays and experienced strong back-to-school sell-through.

In Europe, the company said it continues to see market-leading growth and share gains across the region. Revenue in Europe grew 21 percent in fiscal 2024 on a constant-currency basis, driven by strong demand in both the B2B and DTC channels across all countries.

In the APMA region, Birkenstock said it achieved revenue growth of 42 percent on a constant-currency basis in fiscal 2024. During the year, the company increased brand awareness in this important growth segment by expanding its physical presence and opening several new owned and partner mono-brand stores. The company has also launched online stores in Singapore, Malaysia and the Philippines.

Gross profit margin amounted to 58.8 percent of sales for the fiscal year, down 330 basis points y/y from 62.1 percent in fiscal 2023, reportedly due to the planned, temporary impact of production capacity expansion, channel mix shift, currency translation and other impacts.

Net profit was €192 million for the fiscal year, up 155 percent y/y. Earnings per share amounted to €1.02 per share, up 149 percent year-over-year.

Adjusted net profit was €240 million, up 16 percent y/y; Adjusted EPS of €1.28 was up 13 percent y/y.

Adjusted EBITDA of €555 million was 15 percent y/y, and Adjusted EBITDA margin of 30.8 percent came in above the projected range of 30 percent to 30.5 percent of sales for the year.

Cash flows from operating activities amounted to €429 million for the fiscal year, compared to €359 million in fiscal 2023, resulting in a net leverage ratio of 1.8x LTM EBITDA as of September 30, 2024.

Outlook
Guidance for the fiscal year ending September 30, 2025,  includes:

  • Revenue growth of 15 percent to 17 percent on a constant-currency basis, with a strong contribution from all segments, channels and categories;
  • Adjusted EBITDA margin of 30.8 percent to 31.3 percent, an increase of up to 50 basis points compared with fiscal 2024;
  • Gross profit margin is expected to improve with increased utilization of new production facilities, moving closer to the long-term target of 60 percent;
  • Effective tax rate should be approximately 30 percent;
  • Capital Expenditures of approximately €80 million; and
  • Targeted net leverage ratio at September 30, 2025 of approximately 1.5x.

Image courtesy Birkenstock Holding plc