2010 record year for HUGO BOSS; raises 2011 targets
HUGO BOSS AG can look back on a successful 2010 that was marked by new record highs for sales and profits. The Group is expecting double-digit revenue and earnings growth in 2011.
“We posted outstanding results in 2010 and have maintained this momentum in the new year,“ said Claus-Dietrich Lahrs, Chairman of the Managing Board at HUGO BOSS AG. “I am confident we will comfortably exceed last year's record highs in 2011.”
Currency-adjusted sales rise 24% in fourth quarter
In the final quarter of 2010 currency-adjusted sales rose by 24%. Calculated in euros, Group revenues grew 30% to EUR 422 million (2009: EUR 324 million). The improvement was bolstered by double-digit increases in local currencies in every region (Europe +17%, Americas +20%, Asia/Pacific +62%). Currency adjusted wholesale sales were 11% higher compared to the prior year. Revenues from the Group's own retail activities (including outlets and online stores) increased by 36% in local currencies.
The first-time consolidation of the joint venture with the Rainbow Group in China had a positive impact on this development from July 2010 onwards. The gross profit margin rose 3.2 percentage points to 63.8% (2009: 60.6%) due to the growing share of own retail sales, a consistent pricing strategy and efficiency improvements in production and sourcing. EBITDA before special items increased 64% to EUR 77 million (2009: EUR 47 million) as a result of the higher sales and gross profit margin.
EBITDA before special items reaches EUR 350 million in 2010
In the year 2010 as a whole, HUGO BOSS Group sales were up 7% on a currency-adjusted basis. In the reporting currency, revenues grew 11% to EUR 1,729 million (2009: EUR 1,562 million). Every region contributed to this trend: Europe recorded an increase of 2% in local currencies. Revenues in the Americas and Asia/Pacific improved by 14% and 28% respectively. While currency-adjusted wholesale sales were down 5%, the Group's own retail revenues climbed 30%. Currency-adjusted comparable store sales were 9% higher. The gross profit margin increased by 5.2 percentage points to 59.4% (2009: 54.2%). The adjusted EBITDA margin grew 3.1% to 20.2% (2009: 17.1%).
Significant debt decline
As a result of the increased operating profit and a further decrease in net working capital, the net financial position at the end of the year improved by 47% to EUR 201 million (December 31, 2009: EUR 379 million).
Higher dividend proposed
For the 2010 financial year, the Supervisory Board and Managing Board of HUGO BOSS AG agreed to propose the distribution of a dividend of EUR 2.02 per common share (fiscal 2009: EUR 0.96) and EUR 2.03 per preferred share (fiscal 2009: EUR 0.97) to the Annual Shareholders' Meeting. The dividend increase reflects the significantly higher profit in the last fiscal year and the positive expectations for 2011.
Management forecasts double-digit growth in sales and profits
After a successful start to 2011, the Group expects currency-adjusted sales to grow at least 12%. All of the regions and distribution channels will contribute to the gain. Supported by a further increase of the gross profit margin, operating income (EBITDA before special items) is expected to rise faster than sales and grow at least 15%.
HUGO BOSS AG