Birkenstock Holding PLC (NYSE:BIRK) stock rose 5.23% (As on December 18, 11:20:55 AM UTC-4, Source: Google Finance) after the company unveiled expectation-beating results for the fourth quarter. Revenue surged by 22% to €456 million ($478 million) during the quarter, outdoing estimates for €439 million. A net profit of €52 million was also recorded, against a €28 million loss in the final quarter of last year. Over the year, revenue grew 21% to €1.8 billion, aiding a 155% jump in net profit to €192 million. Birkenstock noted a surge in closed-toe clog sales, which complement its sandals, had helped lead to an 8% increase in average prices during the year. Clog sales “grew over twice the group average and closed-toe share of business increased to approximately one-third,” the company said. Direct-to-consumer sales increased by 21% year over year, as business-to-business sales climbed 23%, supported by growth across America, Europe and Asia.

Moreover, Strong double-digit revenue growth across all segments including 19% in the Americas, 21% in Europe and 42% in APMA on a constant currency basis. DTC revenue growth of 21% and B2B revenue growth of 23% on a constant currency basis. Closed-toe revenue growth of over twice the group average and increased share of business to approximately one-third. Gross profit margin of 58.8%, down 330 basis points from 62.1% due to the planned, temporary impact of production capacity expansion, channel mix shift, currency translation and other impacts. Net profit of EUR 192 million, up 155% year-over-year; EPS of EUR 1.02, up 149% year-over-year. Adjusted EBITDA of EUR 555 million, up 15% year-over-year; Adjusted EBITDA margin of 30.8%, above projected range of 30-30.5%. Cash flows from operating activities of EUR 429 million, compared to EUR 359 million a year ago, resulting in a net leverage ratio of 1.8x LTM EBITDA as of September 30, 2024.

Guidance was laid out for revenue growth of 15% to 17% over the coming year, alongside an adjusted earnings margin of up to 31.3%, against 30.8% in 2024. For fiscal 2025, the company expects Adjusted EBITDA margin of 30.8-31.3%, an increase of up to 50 basis points compared with fiscal 2024, Gross profit margin should improve with increased utilization of new production facilities, moving closer to long-term target of 60%, effective tax rate should be approximately 30%, Capital Expenditures of approximately EUR 80 million and Targeted net leverage ratio at September 30, 2025 of approximately 1.5x.