Hugo Boss returns to profit in third quarter

Worldwide
Published:  05 November, 2020

The Germany headquartered premium fashion label said the Group’s own retail business recorded a considerably more robust performance in the third quarter compared with the first half of the year.

Hugo Boss has posted a 24% sales decline to €533 million, currency-adjusted, but the Group said that online business continues with a double-digit growth trajectory, with sales up 66% for the third quarter. Hugo Boss said that, while all three key regions recorded a business recovery in the third quarter, the pace of recovery was most pronounced in Asia Pacific, with currency-adjusted sales down 14%. Mainland China, a strategically important market for the Group, stood out with revenues up 27% currency-adjusted, marking a successful recovery. In Europe, currency-adjusted sales declined 21% against the prior-year period.

“While the region saw a solid rebound of local demand in key markets such as the UK and France, the restraint in tourism continued to weigh on its overall business recovery”, said the Group. In the Americas, currency-adjusted sales were down 41% for the quarter, as the negative implications of the pandemic are said to have continued to weigh on the Company’s U.S. business, both in own retail and wholesale.

Despite the overall sales decline, the Group’s operating profit (EBIT) is reported to have returned to positive territory in the third quarter, driven by tight cost control and the successful execution of the Company’s expense-reduction measures. Hugo Boss generated a positive EBIT of €15 million in the three-month period, compared with €83 million in the same quarter of 2019.