Quarterly Statement for Q1 2023
Metzingen, May 4, 2023
- Currency-adjusted Group sales in Q1 increase 25% to EUR 968 million
- Double-digit improvements across both brands, all regions, and all channels
- EBIT amounts to EUR 65 million in Q1, 63% above the prior year
- FY 2023 outlook raised: sales to grow ~10% to a level of around EUR 4 billion; EBIT to increase to an amount of between EUR 370 million and EUR 400 million (+10% to +20%)
“We look back on an excellent start to the year, as we further accelerated brand momentum around the globe,” says Daniel Grieder, Chief Executive Officer of HUGO BOSS. “Following our strong performance in the first quarter, we remain all the more confident in the continued success of ‘CLAIM 5.’ We will make 2023 yet another record-breaking year for our Company, as we aim to achieve our mid-term sales target of EUR 4 billion already this year, thus significantly earlier than expected.”
Building on the remarkable momentum in fiscal year 2022, HUGO BOSS continued its strong financial and operational performance in the first quarter of 2023, posting significant top- and bottom-line improvements. Group sales amounted to EUR 968 million (Q1 2022: EUR 772 million), representing an increase of 25% both currency-adjusted and in Group currency. Consequently, revenues once again strongly exceeded pre-pandemic levels (+44% currency-adjusted), with momentum further accelerating as compared to the final quarter of 2022. The powerful start to the year was driven by the continued rigorous execution of the Company’s “CLAIM 5” strategy, which provided substantial tailwinds throughout the quarter. As a result, growth was once more broad-based in nature with double-digit sales increases across both brands, all regions, and all consumer touchpoints.
Successful launch of Spring/Summer 2023 collections drives momentum globally
In January 2023, one year after introducing the bold branding refresh, BOSS and HUGO successfully launched their Spring/Summer 2023 collections, which have once again been very well received by both consumers and wholesale partners worldwide. Thanks to the accompanying global brand campaigns as well as several fashion events, both brands were able to create further buzz throughout the quarter. In particular, in March, BOSS showcased its latest collection at a star-studded “see now, buy now” event in Miami. Selected fashion show pieces were also presented virtually later that month at Metaverse Fashion Week. Fueled by the ongoing strong brand momentum, the Company recorded significant double-digit growth in currency-adjusted sales for BOSS Menswear (+23%), BOSS Womenswear (+28%), and HUGO (+31%) during the first three months of the year.
Double-digit sales improvements across all regions
In the first quarter, all regions recorded double-digit sales improvements, fueled by ongoing robust consumer demand. In EMEA, currency-adjusted revenues increased by 21% year over year, reflecting robust double-digit growth in key markets such as Germany (+28%) and France (+17%), as well as a particularly strong performance in growth markets such as the Middle East. With revenues up 38% currency-adjusted, momentum in the Americas further accelerated both year over year as well as versus pre-pandemic levels, as all of the region’s markets continued their strong double-digit sales trajectories. This also includes ongoing robust momentum in the U.S. market across channels, with currency-adjusted sales up 31% overall. The Group’s business in Asia/Pacific also recorded a powerful start to the year with sales returning to strong double-digit growth of 31%. This performance was driven by both sustained double-digit improvements in South East Asia & Pacific as well as a significant uptick in consumer sentiment in China following the market’s reopening in late 2022 after long-lasting COVID-19-related restrictions. As a result, sales in China came in well above the prior-year level, up 25% currency-adjusted.
Broad-based growth across all consumer touchpoints
From a channel perspective, growth in the first quarter was also broad-based, with all consumer touchpoints recording double-digit sales improvements. The Group’s digital business successfully continued its robust growth trajectory with currency-adjusted sales up 22%, reflecting strong double-digit improvements across all digital touchpoints. In particular, revenues generated via the Group’s digital flagship hugoboss.com increased noticeably, supported by the successful relaunch of the HUGO BOSS app in February. At the same time, the Group’s brick-and-mortar retail business also had an excellent start to the year, recording double-digit sales improvements across all regions. Overall, currency-adjusted revenues in brick-and-mortar retail increased by 26% in the first quarter. On the other hand, HUGO BOSS also recorded a strong uptick in brick-and-mortar wholesale with currency-adjusted sales up 26%, reflecting ongoing healthy demand from partners around the globe.
EBIT up 63% despite ongoing investments into the business
In the first quarter of 2023, HUGO BOSS generated an operating profit (EBIT) of EUR 65 million, representing a significant increase of 63% compared to the previous year
(Q1 2022: EUR 40 million). As a result, the Group's EBIT margin increased by 160 basis points to a level of 6.7%. This performance was driven by the significant top-line improvements, which more than offset a slight decline in gross margin, down 30 basis points to a level of 61.4%, as well as further investments into the business as part of “CLAIM 5.”
HUGO BOSS raises outlook for full-year 2023
In light of the strong financial performance in the first quarter, HUGO BOSS raises its top- and bottom-line outlook for the current fiscal year. Accordingly, while taking into account persistently high macroeconomic and geopolitical uncertainties, HUGO BOSS now expects Group sales in 2023 to increase by around 10% to a level of around EUR 4 billion (prior: increase at a mid-single-digit percentage rate), with all regions set to contribute to growth. At the same time, EBIT in 2023 is now expected to increase within a range of +10% to +20% to an amount of between EUR 370 million and EUR 400 million (prior: increase within a range of +5% to +12% to an amount of between EUR 350 million and EUR 375 million). Ongoing investments in its products, brands, and digital expertise as part of “CLAIM 5” are set to be more than offset by an at least stable gross margin development in 2023 as well as further efficiency gains, in particular when it comes to its brick-and-mortar retail store network.
HUGO BOSS will host Investor Day on June 14 and 15
Following the strong start to the year, HUGO BOSS remains all the more confident in the continued momentum of its “CLAIM 5” growth strategy. On June 14 and 15, the Company will thus present an update on “CLAIM 5” and its mid-term financial ambition as part of an Investor Day, as HUGO BOSS aims to continue delivering sustainable revenue growth and operating leverage supporting its bottom-line ambitions also going forward. The Investor Day will take place at the Group’s headquarters in Metzingen, Germany.
If you have any questions, please contact:
Vice President Investor Relations
Phone: +49 7123 94 – 87563
Vice President Global Corporate Communications
Phone: +49 7123 94 – 86321