UK-based sportswear company Gymshark, which closed its regional sourcing offices in Hong Kong and Mauritius and restructured its North American team last FY, suffered a 32 percent decline in annual operating profit to £20,087,000 (€23.5m) for the 12 months ended July 31, 2023. Net profit, impacted by a 320 percent increase in finance costs, fell by 55 percent to £10,191,000 (€11.9m). Annual gross margin declined by 530 basis points to 59.7 percent.
Total revenues rose 14.8 percent to £556,216,000 (€649.7m) from £484,476,000 for the 12 months. Regionally, the UK paced geographic growth, rising by 26 percent to £111.7 million (€130.5m). Sales throughout Europe, excluding the UK, increased by 16 percent to £129.4 million (€151.2m). Sales in the US jumped by 9.7 percent to £250.5 million (€292.6m) and were 16 percent higher in the Rest of World at £64.6 million (€75.4m).
By channel, DTC sales increased by 11.5 percent to £536.5 million (€626.6m) for the 12 months. Wholesale revenues soared 439 percent to £7.8 million (€9.1m) and increased by 583 percent to nearly £12.0 million (€14.0m) in the retail segment that consisted of sample and pop-up sales. Orders increased by 13.1 percent; units sold rose by 8.7 percent, down from a 27.5 percent increase in FY22, and conversion was flat, the company reported.
The group ended the FY with 7 percent fewer employees than the prior year at 853. Gymshark said it continued to face rising input costs for apparel last year, including higher raw material and labor expenses. But other costs, including freight, began to normalize as the FY progressed.
