Trade: Birkenstock expects strong growth

After a dynamic quarter, sandal manufacturer Birkenstock is also expecting better business for the year as a whole. Sales are expected to rise by a fifth in the 2023/24 financial year (end of October) after adjusting for currency effects, the Birkenstock holding company in London announced. The company had previously targeted 17 to 18 percent. Birkenstock boss Oliver Reichert continues to see great opportunities with the existing products, which he says are only dependent to a limited extent on fashion trends.

In the second quarter of the business year (end of March), Birkenstock increased sales by 22 percent to just over 481 million euros. Asia in particular saw strong growth. However, the gross margin fell because Birkenstock expanded production and this had a temporary impact. The company also said it had to shoulder higher personnel costs. Earnings before interest, taxes, depreciation and amortization adjusted for special effects therefore grew less strongly than revenue by seven percent to 162 million euros. The corresponding margin was 33.7 percent. For the full year, it is expected to be between 30 and 30.5 percent.

The bottom line is that profits jumped by 45 percent to 72 million euros. In the same period last year, higher foreign exchange losses, share-based compensation and restructuring costs had a negative impact.

Birkenstock, with headquarters in Linz am Rhein in Rhineland-Palatinate, went public in New York in October. After a weak start, the share price is now above the issue price of 46 US dollars. The share price climbed to over 54 dollars before trading on Thursday. The Birkenstock holding company is based in London. The main owner is the investment company L Catterton, which owns around 81 percent of the shares. L Catterton is associated with the luxury goods group LVMH and its billionaire boss Bernard Arnault.