Q3 2026 Birkenstock Holding PLC Earnings Call Transcript
Key Points
- Revenue grew 15% in constant currency, at the high end of the annual target, leading to a raised full-year guidance.
- Direct-to-consumer (D2C) growth accelerated to 16% in constant currency, outpacing B2B for the first time in two years.
- Own retail revenue surged 50% in constant currency, with same-store sales up high single digits, driven by rapid store expansion.
- APAC region grew 23% in constant currency, with China up over 50%, showcasing strong premium brand positioning.
- Adjusted EBITDA margin improved 60 basis points on a like-for-like basis, despite increased freight and logistics costs.
- Successful refinancing of senior notes at a 75-basis-point lower rate, reducing interest expense and enhancing financial flexibility.
- Strong product innovation, with non-Boston closed-toe silhouettes up over 50% and new styles like Naples and Utti performing exceptionally well.
- Full price realization remained high at 93% in EMEA, demonstrating brand strength and markdown discipline despite industry-wide promotional pressure.
- Adjusted gross profit margin declined 130 basis points year over year, pressured by FX and incremental US tariffs.
- Ongoing conflicts in the Middle East continue to impact the business, particularly in the UAE, with localized sales disruptions.
- Inventory-to-sales ratio increased to 37% from 33% a year ago, partly due to capitalized tariffs and FX effects.
- Effective tax rate rose to 30%-31% from prior guidance of 26%-28%, due to non-deductible expenses from the ASR and debt issuance.
- Net leverage increased to 1.8x from 1.5x at fiscal year-end 2025, reflecting cash outflows from the share repurchase.
- The shift to closed-toe silhouettes, while beneficial for ASP, creates a slight drag on gross margin due to manufacturing complexity.
- FX headwinds are expected to cause a 350-basis-point drag on full-year revenue growth, impacting reported results.
- The Australia business experienced a timing shift in revenue recognition, impacting APAC growth rates in the quarter.
Good morning and thank you for standing by. Welcome to BIRKENSTOCK's third quarter of fiscal 2026 earnings conference call. (Operator Instructions) I would like to remind everyone that this conference call is being recorded. I will now turn the call over to Megan Kulick, Director of Investor Relations.
Hello, and thank you everyone for joining us today. On the call are Oliver Reichert, Director of BIRKENSTOCK Holding plc and Chief Executive Officer of the BIRKENSTOCK Group, and Ivica Krolo, Chief Financial Officer of the BIRKENSTOCK Group. Today, we are reporting the financial results for our fiscal third quarter ended June 30, 2026. You may find the press release and a supplemental presentation connected to today's discussion on our investor relations website at birkenstock-holding.com.
Results have also been filed on Form 6-K with the SEC. We would like to remind you that some of the information provided during this call is forward-looking and accordingly is subject to the safe
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