Financial Performance - Total sales for the reportable segments reached €461.775 million, with Americas contributing €223.110 million, Europe €191.226 million, and APMA €47.439 million[32]. - Adjusted EBITDA for the total reportable segments was €152.742 million, with a breakdown of €78.767 million from Americas, €61.649 million from Europe, and €12.326 million from APMA[32]. - The company reported a profit before tax of €(13.777) million, reflecting operational challenges and transaction-related costs[32]. - Cost of sales for the year ended September 30, 2023, was €566.1 million, up from €493.0 million in the previous year[138]. - Personnel costs rose to €153.9 million for the year ended September 30, 2023, compared to €119.3 million in the prior year[138]. - Shipping and handling costs for the fiscal year ended September 30, 2023, amounted to €155.2 million, up from €101.1 million in the previous fiscal year[89]. Acquisitions and Goodwill - The acquisition of the predecessor resulted in a total consideration transferred of €3.751 billion, with identifiable net assets valued at €2.223 billion, leading to goodwill of €1.528 billion[34]. - The company anticipates future growth potential, which is reflected in the goodwill recognized from acquisitions, primarily due to expected future growth and an assembled workforce[37]. - As of September 30, 2023, total goodwill is €1,593,917, a decrease from €1,674,293 in September 30, 2022, reflecting a foreign currency translation impact of €(80,376)[42]. Customer and Revenue Diversification - The company did not have any customers contributing 10% or more to total revenue during the reporting period, indicating a diversified customer base[33]. - As of September 30, 2023, the company had no concentration of receivables exceeding 10% with any single customer, minimizing credit risk[37]. - For the fiscal year ended September 30, 2023, sales through third parties in the B2B channel accounted for 60% of total revenues[81]. Inventory and Receivables - Total inventories as of September 30, 2023, amount to €595,092, an increase from €535,605 in September 30, 2022[48]. - Trade receivables increased to €91,694 as of September 30, 2023, compared to €64,604 in the previous year[49]. Capital Expenditures and Investments - The company invested in a new production facility in Pasewalk, Germany, which commenced operations in September 2023[46]. - The average CapEx investments for 2023-2027 are projected at €39,879, with significant investments planned for the Americas region[43]. Personnel and Operating Expenses - Personnel costs surged to €113,905 thousand in the year ended September 30, 2023, compared to €41,267 thousand in the previous year, an increase of 175.5%[66]. - The company has experienced a significant increase in general administration expenses, primarily due to share-based compensation related to IFRS 2, totaling €171.4 million for the fiscal year ended September 30, 2023[89]. Risks and Compliance - The company is exposed to liquidity risk but manages it by ensuring sufficient liquidity for operations and capital expenditures through operating cash flows and short-term borrowings[38]. - The company faces risks from potential disputes with third-party sales and distribution channels that could damage its brand and reputation[81]. - The company is subject to various privacy laws and regulations, which could lead to additional costs and operational impacts if compliance is not maintained[112]. - The company faces risks related to compliance with security standards for payment card information, which could lead to significant fines and impact its ability to accept payment cards[114]. Debt and Financial Obligations - The company reported a term loan in EUR valued at €375 million and a term loan in USD valued at $781.3 million as of September 30, 2023[102]. - The company has a vendor loan of €299.6 million and senior notes of €428.5 million as of September 30, 2023[102]. - As of November 30, 2023, the company had total indebtedness of €1,306.2 million, primarily from Senior Term Facilities, ABL Facility, Notes, and Vendor Loan[166]. Market and Economic Conditions - The company operates in various international markets, facing risks such as political instability, trade disputes, and economic fluctuations, which could materially impact its operations and financial results[121]. - The company is subject to evolving government regulations regarding internet and e-commerce, which could affect its operations and compliance costs[117]. - The company may face increased costs and operational disruptions due to climate change and extreme weather conditions affecting its supply chain[183]. Internal Controls and Governance - The company has identified two material weaknesses in internal control over financial reporting, one of which has been remediated as of September 30, 2023, while the second remains unremediated[210][211]. - The company is subject to Section 404 of the Sarbanes-Oxley Act, requiring a report on internal control effectiveness in its second annual report on Form 20-F[211]. Strategic Initiatives - The company has a balanced shift towards direct-to-consumer (DTC) channels, promoting direct relationships and capturing real-time customer data[220]. - The company operates a complementary multi-channel distribution strategy, optimizing growth and profitability through both DTC and B2B channels[220].
Birkenstock plc(BIRK) - 2023 Q4 - Annual Report