German fashion house Hugo Boss has reported a 3 per cent year-on-year (YoY) growth in revenues in the first half of fiscal 2024 (H1 FY24). The company’s brick-and-mortar wholesale sales saw 7 per cent growth, while the brick-and-mortar retail revenues were flat. Online sales increased by 3 per cent H1 FY24.
Hugo Boss reported a 3 per cent YoY revenue growth in H1 FY24. Q2 FY24 sales decreased by 1 per cent to €1.015 billion (~$1.09 billion).
Gross profit remained stable at €638 million, while operating expenses rose by 9 per cent.
EBIT declined by 42 per cent to €70 million, and net income dropped by 50 per cent.
Boss Menswear sales fell by 2 per cent.
The company saw a 1 per cent decrease in group sales for the second quarter of fiscal 2024 (Q2 FY24). The company’s total sales amounted to €1.015 billion (approximately $1.09 billion) in Q2 FY24, compared to €1.026 billion in the same period last year, Hugo Boss said in a press release.
Gross profit remained relatively stable at €638 million. Operating expenses rose by 9 per cent to €567 million, up from €519 million, driven by increased selling and marketing expenses, which climbed by 10 per cent to €450 million, and higher administration expenses, which rose by 8 per cent to €117 million. As a result, the operating result (EBIT) saw a significant decline of 42 per cent, falling to €70 million from €121 million.
The financial result showed a loss of €12 million, a 28 per cent improvement from the €16 million loss in Q2 FY23. Earnings before taxes decreased by 50 per cent to €54 million, down from €109 million. Consequently, net income dropped by 50 per cent, reaching €39 million, compared to €78 million in the same period last year, the company said in a press release.
Basic and diluted earnings per share also decreased by 51 per cent, falling to €0.54 from €1.09. The tax rate remained consistent at 28 per cent.
In terms of brand performance, Boss Menswear experienced a 2 per cent decline in sales, reaching €794 million from €810 million. Boss Womenswear, however, saw a modest increase of 1 per cent, with sales amounting to €68 million, up from €67 million. Hugo brand sales rose by 3 per cent, totalling €152 million, compared to €148 million in Q2 FY23.
Sales by segment indicated a 3 per cent decrease in the Europe, the Middle East and Africa (EMEA) region, with sales dropping to €604 million from €620 million. The Americas segment saw a 6 per cent increase, rising to €250 million from €236 million. In the Asia-Pacific region, sales fell by 7 per cent, amounting to €136 million, down from €146 million. License sales saw a 3 per cent increase, reaching €26 million.
Analysing sales by distribution channel, brick-and-mortar retail sales fell by 3 per cent to €563 million from €580 million. Brick-and-mortar wholesale experienced a 5 per cent increase, totalling €236 million, up from €224 million. Digital sales declined by 4 per cent, reaching €189 million from €196 million, while license sales remained steady at €26 million.
“The weakening consumer sentiment in most markets led to a rapid slowdown in growth across the entire industry, which we could not completely escape from. And while the macro environment is likely to remain difficult for the time being, we are steadfast in our commitment to continue driving above-trend growth, capturing further market share, and focusing even more on operational and organisational productivity,” said Daniel Grieder, chief executive officer of Hugo Boss.
Fibre2Fashion News Desk (DP)