- Prachi Singh |
Hugo Boss Group sales increased by 6 percent to 653 million euros (760.7 million dollars) in local currencies, while the company said, comp store sales grew 5 percent due to gains in all regions and sales formats. Sales from the Group’s own online business grew by 47 percent, while sales in the wholesale business increased by 10 percent. At 106 million euros (123.5 million dollars), Hugo Boss said, EBITDA before special items remained unchanged compared to the prior-year period.
“Our strategic realignment is taking effect. We are right on track,” said Mark Langer, CEO of Hugo Boss AG in a statement, adding “The sales growth in the second quarter speaks for itself: we achieved almost double-digit growth in Europe and were also able to continue our recovery in the challenging German market. I am therefore very confident that we will achieve our targets for the full year.”
First half revenues rise 5 percent at Hugo Boss
Overall, the company recorded currency-adjusted sales growth of 5 percent in the first six months and at 205 million euros (238.8 million dollars), while EBITDA before special items remained unchanged over the prior year.
On the basis of these results, the company has confirmed its outlook for the full year. The Group continues to expect currency-adjusted sales growth in the low to mid single-digit range. In addition, EBITDA before special items is expected to develop within a range of negative 2 percent to positive 2 percent compared to the prior year.
In the second quarter, the company added, sales development in Europe benefited from mid-single-digit growth in the Group’s own retail business and double-digit growth in the wholesale business. All core markets reported sales increases. In Great Britain, currency adjusted sales grew 12 percent due to double-digit increases in both distribution channels. Sales in the Benelux countries were up 11 percent, due to double-digit growth in the Group’s own retail business. In Germany and France, sales were also up on the prior year, with increases of 2 percent and 5 percent respectively.
Currency-adjusted sales in the Americas remained stable. In the US market, Hugo Boss said, sales growth in the Group’s own retail business was unable to fully offset a decline in the wholesale business. As a result, sales in the US declined by 1 percent. In contrast, the Group recorded low- and mid-single digit sales increases in Canada and Latin America. Asia/Pacific benefited from further growth in the Chinese market in the second quarter. Sales in China increased by 8 percent and comp store sales growth in mainland China was in the high single digits. Hong Kong and Macau also recorded double-digit growth rates and sales rose in Japan.
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Hugo Boss posts sales growth across retail channels
The company further said that the Group’s own retail business (including outlets and online stores) recorded robust sales growth in the second quarter, with currency-adjusted sales up by 5 percent. Sales rose by 5 percent on a comp store and currency-adjusted basis. In Asia/Pacific, sales increased at a high single digit rate. Comp store sales in Europe and in the Americas grew at a mid-single digit and low single digit rate, respectively. Overall, sales in the Group’s own retail business in Europe were up 5 percent on a currency-adjusted basis and came to 256 million euros (298.3 million dollars). Sales in the Americas amounted to 94 million euros (109.5 million dollars), representing a currency-adjusted sales increase of 3 percent. In Asia, sales grew by 7 percent in local currencies to 93 million euros (108.3 million dollars).
Sales in freestanding stores and shops-in-shops rose by 3 percent on a currency adjusted basis. Outlet sales were up 4 percent and in its online business, Hugo Boss achieved a 47 percent increase in sales. At 144 million euros (167.8 million dollars), currency-adjusted wholesale sales in Europe were 17 percent higher than in the prior year. In the Americas, currency-adjusted sales decreased by 5 percent, amounting to 43 million euros (50 million dollars). The Asia/Pacific region saw a 2 percent currency-adjusted increase in sales.
Sales in the license business declined in the second quarter as a result of timing effects relating to the company’s license income. The company said, license sales are expected to increase in the second half of the year. The sales development of Boss and Hugo, the company added, was impacted by ongoing changes in the distribution strategy. Hugo brand sales declined in the second quarter and double-digit growth in casualwear was unable to compensate for the declines in businesswear. The sales development of the Boss, however, benefited from double digit growth in casualwear.
Sales in businesswear also saw significant growth, while the athleisure offering reported a slight increase in sales compared with the prior year. The sales development of menswear benefited from double-digit growth in casualwear. The decrease in sales in womenswear, Hugo Boss said, is attributable to the Boss brand and related to the reduction of retail space in freestanding stores, which was only partly offset by growth in the Hugo brand.
Six Boss stores were opened, while there were 11 closures of stores with expiring leases. The company’s first Hugo store with the new store concept opened in Amsterdam in the second quarter. The company said, further openings in selected European cities are planned for the second half of the year.
Picture:Hugo Boss website