Birkenstock Holding plc Annual Report - How They Did This Year

Hey there, fellow investor! Let's break down Birkenstock's performance for the year ended September 30, 2025, in a way that makes sense. We've got some solid numbers to look at, showing some impressive growth!

First, a quick look at Birkenstock itself:

Birkenstock Holding plc, which became a public company in Jersey in late 2023, is ultimately controlled by L Catterton. At its core, Birkenstock is all about those comfy, footbed-based products, like their famous sandals and closed-toe shoes. But they also dabble in other areas like skincare and accessories.

They reach customers in two main ways:

• Business-to-Business (B2B): This is where they sell their products to other stores and retailers.
• Direct-to-Consumer (DTC): This means selling directly to you, either through their own website (Birkenstock.com) or their dedicated Birkenstock retail stores.

You can find their products all over the world, as they operate across three big regions: the Americas, Europe, Middle East and Africa (EMEA), and Asia-Pacific (APAC).

The Big Picture: Strong Growth in Sales and Profit!

Birkenstock had a fantastic year, continuing its upward trend. They've significantly grown their sales and, even better, their profits have soared!

• Total Sales (Revenue): The company brought in €2.10 billion in sales this year (2025). That's a healthy 16.2% jump from last year's €1.80 billion. Looking back further, sales were €1.49 billion in 2023, so they've been consistently growing.
• Net Profit (What they actually kept): This is where the good news really shines! Birkenstock's profit for the year skyrocketed to €348.3 million. That's a massive 81.7% increase compared to €191.6 million last year. For context, their profit was €75.0 million in 2023, so the growth has been exponential.

Digging Deeper into the Numbers:

Making Money (Profitability):

• Gross Profit (What's left after making the shoes): After covering the direct costs of making their products, Birkenstock's gross profit reached €1.24 billion, up 16.9% from €1.06 billion last year. This means they're maintaining or even slightly improving how much they keep from each sale after paying for materials and manufacturing.
• Profit from Operations (Before taxes and interest): This figure, which tells us how well the core business is running, increased by 30.5% to €549.5 million from €421.1 million last year. This is a strong indicator that their main business activities are becoming more efficient and profitable.

Costs to Run the Business:

• Selling and Distribution Expenses: The costs to get their products to customers went up by 11.2% to €563.7 million. This is expected as sales grow, as they likely spent more on marketing, shipping, and running their stores.
• General and Administrative Expenses: The overhead costs for running the company (like office staff, legal, etc.) saw a more modest increase of 10.3% to €125.2 million. It's good to see these costs growing slower than revenue, which helps boost overall profit.

Financial Health Check:

• Total Assets (What the company owns): Birkenstock's total assets grew slightly by 1.2% to €4.94 billion from €4.88 billion. This indicates continued investment in the business.
• Shareholders' Equity (What's left for owners after debts): This is a key measure of the company's financial strength. It grew by 3.7% to €2.72 billion from €2.63 billion. This increase is largely driven by the significant boost in retained earnings.
• Retained Earnings (Profits kept in the business): This figure jumped by a huge 83.4% to €765.9 million from €417.6 million. This shows the company is holding onto a lot more of its profits to reinvest or strengthen its balance sheet.
• Cash on Hand: Their cash and cash equivalents decreased slightly by 7.5% to €329.1 million from €355.8 million. While a decrease, it's still a substantial amount.
• Inventory: The value of products ready to be sold increased by 12.7% to €704.4 million. This could mean they're stocking up for future demand or have a bit more product on hand.
• Loans and Borrowings (Debt): Good news here! Total loans and borrowings decreased by 4.1% to €1.15 billion from €1.19 billion, indicating they're managing their debt effectively.

For Shareholders:

• Earnings Per Share (EPS): For every share you own, the company earned €1.87 this year. That's a fantastic 83.3% increase from €1.02 last year, and a huge leap from €0.41 in 2023. This is a great sign for investors, as it means the company is generating significantly more profit per share.

Understanding Birkenstock's Business Rhythm: Seasonality

Like many fashion and footwear companies, Birkenstock's sales are affected by the seasons and weather. Think about it – you're probably not buying sandals in a snowstorm!

• Spring and Summer Boost: Their B2B sales (to other stores) tend to pick up in the spring, while their DTC sales (from their own website and stores) really get going in the summer.
• Winter Prep: Between October and March, they're busy manufacturing products, especially for their B2B partners, building up inventory. Then, in the early part of the calendar year, they rely on this built-up stock to fulfill orders for their B2B customers.
• Mitigating the Swings: While unseasonable weather can definitely impact sales, Birkenstock tries to smooth out these seasonal ups and downs. They do this by selling globally (so different seasons in different places), having a diverse customer base, and expanding into different product categories and new regions.

What This Means for You:

Birkenstock had a very strong year, showing robust growth in sales and a remarkable improvement in profitability. They're not just selling more shoes, but they're also doing a much better job at turning those sales into actual profit. The increase in retained earnings and EPS are particularly positive signs for shareholders. While cash on hand saw a slight dip, the overall financial health, with growing equity and decreasing debt, looks solid. Understanding their business model, including how they sell and the seasonal nature of their products, gives you a fuller picture of their operations.