Key Points Birkenstock Holding plc NYSE: BIRK delivered a stellar earnings report, and BIRK stock continues to soar as the broader market reprices equities in anticipation of higher-for-longer interest rates amidst persistent inflation. Birkenstock Today -0.30 (-0.51%) 52-Week Range $35.83 ▼ $59.48 Price Target $52.37 Add to Watchlist BIRK Birkenstock $58.43 Neither seems to be an issue for the luxury footwear maker known for its iconic sandals. The company reported earnings per share of 44 cents on revenue ...

Group 1 - Birkenstock's shares reached all-time highs following the announcement of strong financial results for Q2 2024, with a stock increase of 12% by market close [1] - The company reported record revenue of 481 million euros (approximately $521 million) in Q2, reflecting a year-over-year growth of 22% [2] - Despite a decline in gross margin to 56% from nearly 60% in the previous year, management anticipates returning to a 60% gross margin in the medium term, which reassured investors [3] Group 2 - Management revised its full-year revenue growth expectation from 17%-18% to 19%, contributing to the stock's surge [4] - Since going public in late 2023, Birkenstock has demonstrated impressive results, with a price-to-sales valuation of about 6, which is considered high for a shoe company, but justified by strong profit margins and ongoing growth [5] - The fastest growth is observed in Asia, the Middle East, and Africa, with a 42% increase in Q2, indicating significant expansion potential as these regions currently represent only 11.5% of the business [6]

Key Takeaways Birkenstock set a record for second-quarter sales as demand for its footwear jumped in all categories and regions. The company's earnings and revenue exceeded forecasts, and it raised its full-year outlook. The news sent Birkenstock shares to an all-time high. Shares of Birkenstock Holding Plc (BIRK) jumped to an all-time high Thursday when the maker of fashion footwear posted record second-quarter revenue and boosted its guidance on strong demand across all its segments. The company known for ...

Financial Data and Key Metrics Changes - The company achieved a revenue growth of 23% year-over-year, reaching EUR481 million in the second quarter of fiscal 2024, marking the highest revenue level for this quarter in the company's history [41][72] - Adjusted EBITDA was EUR162 million, up 7% compared to the same quarter last year, with an adjusted EBITDA margin of 33.7%, down 470 basis points from the prior year [31][72] - Adjusted net profit increased by 3% to EUR77 million, with adjusted EPS remaining flat at EUR0.41 due to higher general and administrative costs [31][72] Business Line Data and Key Metrics Changes - Revenue from the top-five core silhouettes grew over 20%, indicating strong performance in the classic product lines [26][41] - The DTC channel grew by 32% year-over-year, while B2B revenue increased by 20%, demonstrating robust demand across both channels [25][72] - Closed-toe silhouettes saw a penetration increase of over 25%, up 900 basis points from the prior year, with significant growth in premium offerings [26][28] Market Data and Key Metrics Changes - The Americas region experienced a revenue increase of 21%, with DTC growth outpacing B2B growth [44][72] - APMA was the fastest-growing segment, with a revenue growth of 42%, driven by both volume and ASP increases [46][72] - In Europe, revenue grew by 21%, significantly outperforming the overall retail market, with closed-toe silhouettes growing over 80% [28][72] Company Strategy and Development Direction - The company is focused on expanding its membership program, which has seen a 40% growth, to enhance customer loyalty and engagement [41][96] - The strategy includes disciplined distribution and a focus on premium products to drive ASP growth, with a commitment to maintaining brand equity [50][72] - The company is raising its fiscal 2024 revenue growth forecast to 20% on a constant-currency basis, reflecting confidence in sustained demand [24][50] Management's Comments on Operating Environment and Future Outlook - Management noted that despite a challenging consumer environment, the brand's strength is reflected in strong sales and demand across all segments [30][41] - The company is optimistic about the second half of the year, with no current indicators suggesting a slowdown in growth [77][96] - Future pricing strategies will be evaluated to offset inflationary pressures while maintaining consumer demand [67][103] Other Important Information - The company opened six new retail stores in the second quarter, bringing the total to 57, with strong performance from new locations [25][81] - Inventory levels were at EUR651 million, approximately 40% of revenue, down from 44% in the previous year, indicating effective inventory management [73][72] - The company is investing in production capacity expansion, with capital expenditures totaling EUR17 million in the second quarter [73][72] Q&A Session Summary Question: Can you elaborate on the brand's continued global momentum? - Management expressed confidence in maintaining a revenue growth forecast of around 20% for the full year, consistent with a long-term growth trend [77] Question: How is the sandal business performing since the end of the quarter? - The sandal business has shown strong momentum, with significant sell-through rates and a transition towards premium products [59] Question: What is the outlook for gross margins and production facility optimization? - Management indicated that 2024 is a transition year, with expectations for improved margin absorption starting in 2025 as production facilities become more efficient [86][72]

| --- | --- | --- | |-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | 1,609 | | 1,299 | | | | | | 483 | | 502 | 02 | --- | --- | --- | |----------------------------------------|-----------|-------| | Operating Cash Flow | FY23 \n57 | FY24 | | t/o: Funds from operations | 149 | | | t/o: Changes in working capital | (91) | | | Investing Cash Flow | (25) | | | Financing Cash Flow | (29) | | | t/o: Net IPO proceeds | — | | | t/o: Repayment of loans and borrowings | (2) | | | t/o: Cash interest ...

Investors interested in stocks from the Shoes and Retail Apparel sector have probably already heard of Skechers (SKX) and Birkenstock (BIRK) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earning ...

Financial Data and Key Metrics - Revenue for Q1 2024 was EUR 303 million, up 26% YoY, driven by growth across all segments and channels [9] - DTC revenue grew by 30% YoY, contributing to 53% of total revenue, while B2B revenue increased by 22% [9] - Adjusted EBITDA was EUR 81 million, up 12% YoY, with an adjusted EBITDA margin of 26.9%, impacted by capacity expansion and unfavorable currency translation [27] - Gross profit margin was 61%, down 70 basis points YoY, due to capacity expansion and currency effects [87] - Cash and cash equivalents stood at EUR 169 million, with inventory buildup in preparation for spring-summer 2024 wholesale shipments [28] Business Line Performance - DTC channel penetration increased further, with approximately half of revenues generated from membership program members [5] - B2B revenue growth was driven by expansion in categories like closed-toe silhouettes, with significant growth in existing partner stores [15][45] - Closed-toe silhouettes, including clogs, contributed more than half of total revenue in the APMA region [8] - The professional product category delivered the second-highest growth rate in terms of value and units [94] Market Performance - Americas revenue grew by 19%, driven by strong DTC performance and increased penetration in existing B2B channels [5][15] - Europe revenue increased by 33%, with strong sell-out performance during the holiday season and successful price adjustments [16][120] - APMA was the fastest-growing segment, with revenue growth of 51%, driven by DTC and digital channel expansion [8][52] Company Strategy and Industry Competition - The company is doubling its production capacity in Germany and Portugal over the next three years to meet growing demand [46] - Strategic focus on premium products and DTC channels, with a goal to maintain a gross profit margin over 60% and an adjusted EBITDA margin in the low 30s mid-term [30][112] - Expansion into new categories like closed-toe footwear and professional products is driving growth and diversifying revenue streams [92][94] Management Commentary on Operating Environment and Future Outlook - Management remains confident in the company's ability to sustain strong performance through 2024 and beyond, despite temporary margin compression from capacity expansion [14][30] - The company is successfully recovering inflation through selective price increases and optimizing channel and product mix [87][112] - The shift towards intentional purchasing by consumers is benefiting the brand, with high levels of full-price realization across all distribution points [4][95] Other Important Information - The company repaid EUR 525 million of debt, reducing net leverage to 2.6% as of December 31, 2023 [98] - Capital expenditures of EUR 80 million were primarily related to production capacity expansion [98] - The company launched new products in expansionary categories, including a professional line at the A+A trade fair, which received strong demand [94] Q&A Session Summary Question: Impact of inflation and capacity utilization [21] - The company is managing inflation through selective price increases and is on track with capacity expansion, which is expected to impact margins temporarily [30][112] Question: Closed-toe footwear performance and mix [22][42] - Closed-toe silhouettes now exceed sandals in revenue share, with clogs, boots, and sneakers driving growth [22][64] - The Boston clog remains a top performer, but other closed-toe products like the Highwood and Prescott boots are also exceeding expectations [102] Question: Gross margin and inventory levels [35][69] - Gross margin is expected to be lower in Q2 due to seasonality and higher wholesale share, but the company remains confident in its full-year guidance [58][71] - Inventory levels are in line with historical patterns, with a focus on preparing for spring-summer wholesale shipments [28][109] Question: Growth trajectory in APMA region [51] - The APMA region is experiencing strong growth, with price increases well-received and no negative consumer impact [52] - The company is expanding its DTC and B2B presence in the region, with a focus on Greater China, Japan, and Southeast Asia [52] Question: ASP growth and premium product shift [34][115] - ASP growth is expected to be in the mid- to high-single digits, driven by premium products and channel mix [115] - The shift towards premium products, including closed-toe footwear, is contributing to higher ASPs [92][115] Question: European market performance [119] - Europe has completed its transformation plan, with strong sell-out performance and successful price adjustments [119][120] - The company is well-positioned in the European market, with full-price realization superior to the market [120]

Birkenstock traded flat in the US premarket on Thursday as earnings slumped despite the sandal maker beating revenue guidance over the festive period. Revenues jumped 26% year-on-year to €303 million, beating out Wall Street predictions of just over €288 million, largely a result of both higher prices and increased demand in the States. However, earnings per share came in at €0.04, below analyst expectations of €0.09 as the group’s gross profit margin slipped 70 basis points to 61%. Birkenstock said the fal ...

| --- | --- | |----------------------------|--------------------------------------------------| | Washington, D.C. 20549 | UNITED STATES SECURITIES AND EXCHANGE COMMISSION | | FORM 6-K | | REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 For the Month of February 2024 Commission file number: 001-41836 Birkenstock Holding plc (Translation of registrant's name into English) 1-2 Berkeley Square London W1J 6EA United Kingdom (Address of principal execu ...

Birkenstock on Thursday beat holiday quarter revenue expectations, reporting a 26% year-on-year jump, as the German sandal company benefited from higher pricing and rising U.S. demand.Here's how the shoemaker did in its first fiscal quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG, formerly known as Refinitiv:Earnings per share: 4 euro cents vs. 9 euro cents expectedRevenue: 303 million euros vs. 288.7 million euros expected.The newly public shoemaker, which sta ...