Source: (c) Copyright Thomson Reuters 2022. Click for restrictions – https://agency.reuters.com/en/copyright.html
Dusseldorf (Reuters) – There is still no sign of reluctance to buy into fashion group Hugo Boss.
CFO Yves Müller said Thursday that the third quarter followed smoothly from the second and had the highest sales in the company’s history. Everywhere Boss development is “extremely dynamic”, although the menswear outfit from Metzingen has raised prices for its winter collection into the mid-single-digit percentage range. Sales quotas are above expectations. This made the board safer. He raised his targets for 2022 for the second time.
However, investors remained skeptical: the stock fell 3.5 percent to 45.00 euros in an overall weak market. “In our opinion, the recent very high level of consumer enthusiasm for the group’s brands should not come to an abrupt halt in 2023, but we should fear that demand dynamics in the environment of high living costs will slow down ,” commented Thomas Maul from DZ Bank.
EXECUTIVE BOARD REMAINS OPTIMISTIC FOR Q4
Boss has so far remained unaffected by the general economic downturn. “For Hugo Boss, we do not see any weakening of consumer demand even at the beginning of the fourth quarter,” explained Müller. One reason he gave was the revamping of Boss’s collections, which are now also “really well received” by younger customers. There is also growth in all regions, across all brands and channels. Therefore, the board is now targeting sales growth of between 25 and 30 percent in 2022 instead of 20 to 25 percent. The operating result (EBIT) should increase by 35 to 45 percent to 310 to 330 million euros instead of 25 to 35 percent.
In the third quarter, currency-adjusted sales rose 18 percent to 933 million euros, marking a record figure. EBIT increased by eight percent to 92 million euros.
While Boss and luxury goods groups Hermes and LVMH, as well as Zara’s Spanish parent company Inditex, have weathered the crisis well so far, lower-priced fashion companies such as H&M and Next are feeling their customers’ reluctance to buy. They are tightening their belts because of exploding energy and food costs.
(Reporting by Anneli Palmen, editing by Ralf Banser; if you have any questions, please contact our editorial team at email@example.com (for politics and economics) or firstname.lastname@example.org (for companies and markets) )