14. March 2012
Press Releases – Financial
Metzingen, March 14, 2012. HUGO BOSS AG achieved significant increases in sales and earnings in 2011, exceeding the original expectations. The management expects to improve these record results further in 2012.
“Last year’s success is evidence of the attractiveness and the efficiency of our business model,” comments Claus-Dietrich Lahrs, CEO of HUGO BOSS AG. “Based in particular on our global brand strength and our increased retail expertise, I am confident that we can grow strongly in 2012, too.”
Significant increases in sales and earnings in fourth quarter of 2011
In the fourth quarter of 2011, sales climbed by 17% after adjustment for currency effects. In euros, the Group generated an 18% increase in sales to EUR 499 million (2010: EUR 422 million). This improvement was supported by double-digit currency-adjusted growth in all regions (Europe +14%, Americas +24%, Asia/Pacific +20%). In wholesale, sales were up 4% on the previous year after adjustment for currency effects, while in the Group’s own retail business (including outlets and online business) they rose by 28%. On a comp store basis, the increase in the Group’s own retail business amounted to 6% after adjustment for currency effects. Gross margin improved by 240 basis points to 66.2% (2010: 63.8%), primarily due to the higher share of sales in this distribution channel. As a result of efficiency improvements, EBITDA before special items increased more strongly than sales, rising by 26% to EUR 97 million (2010: EUR 77 million). The adjusted EBITDA margin thus increased by 120 basis points to 19.4% in the fourth quarter (2010: 18.2%).
Adjusted EBITDA margin improves to 22.8% in 2011
The HUGO BOSS Group generated substantial growth in all divisions in 2011. Sales were up 19% both on a currency-neutral basis and in the reporting currency, amounting to EUR 2,059 million (2010: EUR 1,729 million). Europe posted a 15% increase on a currency-neutral basis due to considerable growth in Germany and the UK in particular. The Americas and Asia/Pacific generated growth of 24% and 34% respectively thanks to significant increases in the US and Chinese markets. Wholesale sales were up 9% after adjustment for currency effects. In the Group’s own retail business, currency-adjusted sales were 35% higher than in the previous year. On a like-for-like basis and after adjustment for currency effects, the increase in the Group’s own retail business amounted to 8%. The above-average sales growth in the Group’s own retail business and a higher share of sales at full price contributed to a gross margin increase of 200 basis points to 61.4% (2010: 59.4%). Supported by efficiency improvements, EBITDA before special items thus increased by 34% to EUR 469 million (2010: EUR 350 million). The adjusted EBITDA margin thus amounted to 22.8% (2010: 20.2%).
Earnings increase supports reduction in debt
Net debt decreased by 26% to EUR 149 million at the end of the year (2010: EUR 201 million). The substantial earnings increase supported this development significantly, more than offsetting increases in trade net working capital and in capital expenditure, which amounted to EUR 108 million in 2011 and was thus considerably higher than the previous year’s level of EUR 56 million.
Higher dividend proposed
Given the strong earnings performance in the past year, the Managing Board and Supervisory Board of HUGO BOSS AG have resolved to propose a significant dividend increase at the Annual Shareholders’ Meeting. The dividend per ordinary share for fiscal 2011 is to be increased to EUR 2.88 (dividend for fiscal 2010: EUR 2.02) and the dividend per preferred share to EUR 2.89 (dividend for fiscal 2010: EUR 2.03). This proposal corresponds to a payout ratio of 70% of consolidated net income attributable to shareholders for 2011.
Management forecasts considerable sales and earnings increases
HUGO BOSS expects to generate sales growth of up to 10% after adjustment for currency effects in 2012, with all regions and distribution channels contributing to this growth. The Group plans to open around 50 new stores on an organic basis over the course of the year. Primarily due to the planned expansion of the Group’s own retail network as well as renovations of existing stores, capital expenditure in 2012 will exceed the previous year’s level. EBITDA before special items is expected to increase at a slightly higher rate than sales.
Please direct any queries to:
Dr. Hjördis Kettenbach
Head of Corporate Communications
Tel.: +49 (0) 7123 94-2375
Fax: +49 (0) 7123 94-2051
Head of Investor Relations
Tel.: +49 (0) 7123 94-86267
Fax: +49 (0) 7123 94-886267
HUGO BOSS AG
Phone: +49 7123 94-0
Fax: +49 7123 94-80259