Gymshark Reports Growth in FY24: Revenue and EBITDA Rise Despite Market Challenges

Gymshark Group has released its financial results for the year ending July 2024 (FY24), showing strong growth in revenue and EBITDA, though some profit metrics were lower due to ongoing investments and rising costs. As the parent company of Gymshark Ltd and Gymshark USA, Gymshark continues to thrive globally, with notable international revenue growth.

Key Financial Highlights:

• Revenue Growth: Gymshark’s total revenue reached £607.3 million, marking a significant increase from £556.2 million in the previous year. International revenue grew by 20%, while North America saw a 6% rise, excluding foreign exchange impacts.
• Profit Trends: The company remained profitable, though profit before tax dipped to £11.9 million from £13.1 million. Adjusted EBITDA, however, rose to £51.7 million from £45.3 million, reflecting solid operational performance despite cost pressures.
• Gross Profit Margin: Gymshark’s gross profit margin improved to 63%, up from 60% in FY23, demonstrating enhanced efficiency in its operations.
• Net Profit: The net profit for FY24 was £7.2 million, down from £10.2 million in FY23, reflecting higher taxes and increased operating costs.
• Order and Sales Growth: The company saw a 14.1% increase in orders, surpassing the 13.1% growth in the previous year. Unit sales rose by 13.6%, a significant jump compared to the 8.7% increase in FY23, though conversion rates fell slightly by 30 basis points.

Retail Expansion and Strategic Investments:

In FY24, Gymshark continued to invest in its retail and channel expansion strategy, spurred by the success of its Regent Street store in London. This led to the opening of a second permanent retail location in June 2024 at Westfield Stratford. Unlike the Regent Street store, this new venue introduces a fresh concept, designed to be a core trading hub for the brand.

Market Conditions and Consumer Trends:

The company highlighted the ongoing macroeconomic challenges, particularly rising input costs, such as raw materials and labor. However, costs like freight have “significantly normalised” compared to previous years. Despite ongoing cost-of-living pressures, consumers continue to prioritize value for money, a trend that Gymshark is keen to address with its product offerings.

International Expansion:

Gymshark’s expansion efforts were further supported by its strategic partnership with Selfridges in the UK. This collaboration, which includes locations in London’s Oxford Street and Manchester’s Trafford Centre, helped extend the brand’s reach. Additionally, Gymshark made strides in the Gulf Cooperation Council (GCC) region through its partnership with Al Tayer, enhancing its presence in key international markets.

Operational Efficiency and Inventory Management:

The company emphasized its focus on improving operational efficiency across product development, supply chain management, and commercial strategy. Gymshark took proactive steps in FY23 to manage stock levels more effectively, resulting in a 12% year-on-year increase in stock, reaching £110.6 million by the end of FY24. This increase was attributed to additional stock purchases ahead of Black Friday sales and to mitigate shipping delays caused by disruptions in the Red Sea region.

Strategic Outlook for FY25:

Looking ahead, Gymshark has developed a comprehensive three-year strategic plan in collaboration with its key stakeholders. With this roadmap in place, the company is confident in its ability to maintain strong growth and improve profitability in FY25. The board expressed satisfaction with the overall performance, particularly in the first half of FY24, including successful campaigns during Black Friday and Cyber Monday.

Gymshark’s robust growth in FY24, coupled with its continued investment in retail and international expansion, positions the brand for sustained success in the coming years.