Hugo Boss Q3 sales deteriorate in Asia and the Americas
16 Oct 2015
Hugo Boss has said that its sales development was marked by high levels of volatility in the third quarter of 2015 from July to September. While performance in Europe remained strong, momentum in Asia and the Americas deteriorated considerably towards the end of the period. The company has blamed sales declines in China as well as a negative development in the Group’s US own retail and wholesale businesses due to weaker demand from tourists.
Impact of weak economy on sales
As a result, third quarter sales declined by 1 percent excluding currency effects on a preliminary basis. In euro terms, sales increased by 4 percent to 744 million euros (846.9 million dollars). Retail comp store sales remained stable year-on-year in local currencies. Due to particularly challenging sales trends in the Group’s directly operated stores (DOS) as well as continued investments in the medium- and long-term growth potential of Hugo Boss, EBITDA before special items declined by 8 percent in the third quarter on a preliminary basis.
In addition, the company said that the financial result was impacted by a negative charge of around 16 million euros (18.2 million dollars) related to adverse exchange rate movements of the Brazilian real and the Swiss franc in particular.
Forecasts FY15 sales expectations
In light of weaker than expected trading in the third quarter, Group sales are now forecasted to increase between 3 percent and 5 percent on a currency-adjusted basis in the year 2015 as a whole. Growth of EBITDA before special items is projected to range between 3 percent and 5 percent as well. This outlook is based on the assumption that fourth quarter retail comp store sales will remain stable or develop positively compared to the prior year quarter.
Final third quarter results will be published as part of the nine months results announcement on November 3, 2015.