- Currency-adjusted Group sales in Q2 increase 20% to EUR 1,026 million
- Double-digit growth across all brands, regions, and channels
- EBIT increases 21% to EUR 121 million in Q2; EBIT margin up 40 basis points to 11.8%
- FY 2023 outlook raised: Sales to grow between 12% and 15% to a level of EUR 4.1 billion and EUR 4.2 billion; EBIT to increase between 20% and 25%
“After our highly dynamic start to the year, we continued our strong performance also in the second quarter. Momentum once again exceeded our own high expectations, despite the overall challenging and uncertain market environment,” says Daniel Grieder, Chief Executive Officer of HUGO BOSS. “Following our strategy update in June, both brands BOSS and HUGO successfully maintained their growth trajectory. We will make 2023 a new record year for HUGO BOSS, thus providing a robust foundation for achieving our updated 2025 financial ambition.”
Following its strong start into fiscal year 2023, HUGO BOSS maintained its stellar momentum also in the second quarter, recording further significant top- and bottom-line improvements. As in previous quarters, growth was fueled by several brand, product, and distribution initiatives as part of the ongoing rigorous execution of the Company’s “CLAIM 5” strategy. This led once more to record quarterly sales with broad-based growth across both brands, all regions, and all channels. Consequently, Group sales increased by 20% currency-adjusted to EUR 1,026 million (Q2 2022: EUR 878 million) and by 17% in Group currency, respectively. Revenues continued to significantly exceed pre-pandemic levels (+52% currency-adjusted), with growth further accelerating as compared to the first quarter. Fueled by the very robust top-line momentum, operating profit (EBIT) increased 21% in the second quarter, amounting to EUR 121 million (Q2 2022: EUR 100 million). On the back of these strong results, HUGO BOSS again raises its top- and bottom-line expectations for fiscal year 2023 following the former guidance increase in May.
Brand and product initiatives drive momentum for BOSS and HUGO
Fueled by the bold Spring/Summer 2023 campaigns, BOSS and HUGO continued their robust sales trajectory in the second quarter. As a result, both brands further expanded market shares worldwide, especially among younger consumers. This particularly reflects the ongoing success of the latest BOSS and HUGO collections, which led to strong sell-through rates across all distribution channels. Consequently, BOSS Menswear, BOSS Womenswear, and HUGO posted significant double-digit sales improvements in the second quarter. Currency-adjusted revenues for BOSS Menswear were up 18% year over year, while revenues for BOSS Womenswear even expanded by 32%. At HUGO, currency-adjusted sales were up 21%.
Broad-based growth with double-digit improvements across regions
While the Group’s business in EMEA and the Americas continued to benefit from both robust local consumer demand and a pick-up in tourist business, Asia/Pacific recorded superior growth in the second quarter. Sales in EMEA increased by 15% currency-adjusted in the three-month period. This performance was driven by double-digit improvements in key European markets such as Germany (+19%) and France (+15%), while momentum remained equally strong in the Middle East. Also in the Americas, HUGO BOSS successfully continued its double-digit growth trajectory with currency-adjusted sales up 20%, reflecting double-digit increases across all of the region’s markets. The important U.S. market posted a noticeable increase of 16% currency-adjusted, with all consumer touchpoints contributing to growth. In Asia/Pacific, currency-adjusted revenues came in 41% above the prior-year level. This performance was driven by both sustained double-digit growth in South East Asia & Pacific as well as a further recovery in the business in China following the market’s reopening in late 2022. Currency-adjusted revenues in China thus increased by 56% year over year.
Momentum in digital business accelerates in the second quarter
All channels contributed to the strong top-line performance in the second quarter. In particular, momentum in the Group’s digital business further accelerated, with revenues up 30% currency-adjusted compared to the prior-year level. This performance reflects double-digit improvements across all digital touchpoints, including the Group’s digital flagship hugoboss.com as well as digital revenues generated with partners. Also in brick-and-mortar retail, HUGO BOSS drove robust double-digit sales improvements with revenues up 17% compared to the prior year. While additional selling space only had a minor impact on brick-and-mortar retail growth, the vast majority of the strong performance was related to further store productivity improvements in the second quarter. In brick-and-mortar wholesale, revenues also increased by 17% currency-adjusted, reflecting ongoing strong reception of the latest BOSS and HUGO collections among wholesale partners around the globe.
EBIT up 21% despite further investments into the business
In light of the strong top-line improvements, HUGO BOSS also significantly increased its EBIT in the second quarter, up 21% to EUR 121 million (Q2 2022: EUR 100 million). Consequently, the Group’s EBIT margin increased 40 basis points to 11.8% (Q2 2022: 11.4%). Higher revenues compensated for a decline in gross margin, down 120 basis points to 62.3% (Q2 2022: 63.5%), as well as further investments into the business as part of “CLAIM 5.”
HUGO BOSS raises outlook for full-year 2023
On the back of the strong financial performance in the second quarter, HUGO BOSS once again raises its top- and bottom-line outlook for the current fiscal year. The Company now forecasts Group sales in fiscal year 2023 to increase between 12% and 15% to a new record level of between EUR 4.1 billion and EUR 4.2 billion (prior guidance: increase of around 10% to around EUR 4 billion). At the same time, EBIT is now expected to increase between 20% and 25% to a level of between EUR 400 million and EUR 420 million in 2023 (prior guidance: increase of between 10% to 20% to an amount of EUR 370 million to EUR 400 million). Fiscal year 2023 will thus mark another important milestone for HUGO BOSS towards achieving its updated 2025 financial ambition, which the Company only raised back in June. By 2025, HUGO BOSS is confident of generating revenues of EUR 5 billion and EBIT of at least EUR 600 million, representing an EBIT margin of at least 12%.
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