Q4 2024 Birkenstock Holding PLC Earnings Call Transcript
Key Points
- Birkenstock Holding PLC (BIRK) reported a strong fiscal 2024 with a 22% revenue growth in constant currency, surpassing expectations.
- The company achieved an adjusted EBITDA margin of 30.8%, exceeding the high end of their forecast.
- BIRK's own retail revenue grew over twice the pace of the overall business, with 20 new stores opened globally in fiscal 2024.
- The APMA region was the fastest-growing segment, with a 42% increase, nearly double the pace of the overall business.
- BIRK's membership base grew by over 30% during the year, with members spending on average 30% more than non-members.
- Gross profit margin for the full year was down 330 basis points from 2023, impacted by temporary under-absorption costs from added production capacity.
- The company anticipates only modest improvement in gross margin for 2025, with full absorption of fixed costs expected by the third quarter of 2026.
- BIRK's net leverage was 1.8 times as of September 30, 2024, which is above their target of 1.5 times for fiscal 2025.
- The company faces challenges in maintaining a balance between B2B and B2C growth, with 90% of B2B growth coming from existing wholesale partners.
- Despite strong growth, the company is cautious about expanding too quickly, emphasizing the need for mindful planning and quality control.
Good morning and thank you for standing by. Welcome to Birkenstock's fourth-quarter and fiscal year 2024 earnings conference call. (Operator instructions) I would like to remind everyone that this conference call is being recorded.
I will now turn over the call 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 Eric Mossman, Chief Financial Officer of the Birkenstock Group. Klaus Baumann, Chief Sales Officer; David Kahan, President of the Americas; Nico Bouyakhf, President of EMEA; and Alexander Hoff, Vice President of Global Finance will also join us for the Q&A.
Today we are reporting the financial results for our fiscal fourth-quarter and full year ending September 30 2024. You may find the press release and supplemental presentation connected to today's discussion on our investor relations
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