- Expanding revenue and profit margins for Birchwood
Birkenstock, the shoe brand, fell short of anticipations in the third quarter, despite a significant boost in profits. The company's leadership merely maintained its annual forecast, leaving some investors dissatisfied. As a result, the stock dipped by 11% in pre-market US trading on Thursday, contrasting its 32% rise since its US debut in mid-October.
From April to June, sales saw a roughly 20% year-on-year increase to €565 million, as revealed by the company in London. This figure marked the highest revenue in Birkenstock's history, as per CEO Oliver Reichert. The demand for closed shoes was outstanding. Profits grew at a similar pace, reaching €75 million.
Analyst Luca Solca from Bernstein labeled the results as "strong" but pointed out that Birkenstock had slightly underperformed market estimates. These expectations had risen after the company raised its annual projection following the second quarter.
CEO Reichert now anticipates a 19% revenue growth and an adjusted Ebitda margin between 30-30.5% for the current fiscal year. However, in the recently concluded third quarter, this margin dipped by 1.4 percentage points to 33% compared to the previous year. Birkenstock attributed this decrease partly to expanding production capacity.
Despite achieving record sales with a 20% year-on-year increase in sales to €565 million, Birkenstock fell short of some investor expectations in the third quarter. Despite these record sales, the company's stock dipped due to slight underperformance against market estimates.
