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July 14, 2022

Hugo Boss hikes FY outlook on strongest Q2 in history

German luxury fashion brand Hugo Boss now expects full-year group sales to reach a record level of between EUR3.3-EUR3.5bn (US$3.3-$3.5bn) after what it called the strongest second quarter in its history.

By Beth Wright

Hugo Boss’ outlook for the full year now includes a 20-25% increase in group sales on the back of a preliminary 34% rise in currency-adjusted group sales in the second quarter, compared to the prior-year period.

In group currency, revenues were up 40% in the second quarter to EUR878m, compared to EUR629m a year earlier, marking the strongest second quarter in the history of Hugo Boss.

In Europe, currency-adjusted sales were up 41% year-over-year, translating into what the group called a robust three-year-stack growth of 36%, with all major markets contributing. In the Americas, Hugo Boss drove currency-adjusted sales growth of 45% year-over-year, with three-year-stack growth amounting to 38%.

In Asia/Pacific, currency-adjusted revenues remained on par with the prior-year level. Double-digit growth in South East Asia and Pacific compensated for a sales decline in China, largely reflecting Covid-related temporary store closures throughout much of the second quarter.

Despite being up against a particularly strong comparison base from the prior-year period, total digital currency-adjusted sales were up 11%. While in brick-and-mortar retail, Hugo Boss recorded double-digit sales improvements, with revenues up 38% compared to the prior year.

On a preliminary basis, operating profit (EBIT) amounted to EUR100m, above the prior-year level of EUR42million. Hugo Boss says the increase mainly reflects the strong group sales development as well as noticeable improvements in gross margin driven by an overall higher share of full-price sales.

In light of what it called the strong top and bottom-line performance in the second quarter, but also taking into account the ongoing macroeconomic uncertainties, Hugo Boss has raised its outlook for the current fiscal year. It now expects group sales in fiscal year 2022 to increase between 20-25% to a new record level of between EUR3.3bn-EUR3.5bn. This is up from prior guidance of a 10-15% rise to between EUR3.1bn-EUR3.2bn.

EBIT in 2022 is now expected to increase between 25-35% to between EUR285m-EUR310m, up from previous forecasts of EUR250m-EUR285m.

Last month, Frasers Group upped its stake in Hugo Boss to 26% following two previous increases earlier this year.

Hugo Boss will publish its full second quarter 2022 results on 3 August.

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