By Joshua Kirby
Rising online sales and strong brand development helped Hugo Boss AG deliver above consensus revenue growth in the last quarter of 2021 as the company’s sales strategy German high-end fashion seems to be paying off.
According to preliminary figures released on Tuesday, Hugo Boss achieved sales of 906 million euros ($1.03 billion) in the fourth quarter, up more than half year on year at constant exchange rates, and 12 % more than the same period of 2019, before the global pandemic hit.
Analysts had expected quarterly sales of 867 million euros, according to a consensus of three estimates compiled by FactSet. The result means Hugo Boss’s full-year sales grew 43% organically from 2020, beating a higher target, set in October, of around 40% growth.
Quarterly profit before interest and tax meanwhile came to 100 million euros, helping Hugo Boss reach an estimated annual operating profit of 228 million euros, according to preliminary figures. The company had targeted an EBIT of up to 200 million euros for the year.
Revenue development was boosted in the fourth quarter by online sales, which rose 50% year-on-year to account for 20% of the total, Hugo Boss said. In the August strategy update, new chief executive Daniel Grieder said he wants digital sales to be 25-30% of the total by 2025. The company has also set a goal of doubling total sales over the same period, compared to 2020.
The BOSS and HUGO brands both helped boost fourth-quarter revenue, driven by the rise of casual wear and the continued recovery of formal wear as “wearing occasions” increased, the company said. . In this summer’s update, Grieder said the company would invest in differentiating and promoting the group’s brands, with a focus on winning over young consumers and new buyers in the Chinese market. “Our goal is to grow Hugo Boss in a fast but sustainable way,” he said at the time.
Fourth-quarter revenue rose 18% in mainland China from the pre-pandemic period, Hugo Boss said, helped by store reopenings. Globally, 98% of Hugo Boss stores were in operation during the quarter, the company said.
Write to Joshua Kirby at firstname.lastname@example.org; @joshualeokirby