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Asian market deterioration weighs on Hugo Boss Q3 sales
23 Oct '15
2 min read
Deterioration of market environment in Asia and slowdown in the Americas has weighed on sales and earnings performance of fashion and luxury products marketer Hugo Boss in the third quarter ended September 30, 2015.
In its interim results, Hugo Boss said third quarter of 2015 sales declined 1 per cent excluding currency effects, but in euro terms, they increased 4 per cent from a year ago period to €744 million.
However, comparable store sales in company owned retail stores remained stable year-on-year in local currencies.
According to Hugo Boss, due to particularly challenging sales trends, EBITDA before special items dropped 8 per cent year on year to €168 million in the third quarter of 2015.
In addition, the Group's financial result was impacted by a negative charge of around €16 million related to adverse exchange rate movements of the Brazilian Real and the Swiss Franc in particular.
The company further added that while performance in Europe remained strong and in line with original expectations, momentum in Asia and the Americas deteriorated considerably during the reporting quarter.
“This was due to sales declines in China as well as a negative development in the Group's US own-retail and wholesale businesses and weaker demand from tourists contributed to the slowdown in the US,” it explained.
In light of weaker than expected trading in the third quarter, Hugo Boss has now forecast sales to increase between 3 and 5 per cent on a currency-adjusted basis in full year 2015.
Growth of EBITDA before special items is projected to range between 3 and 5 per cent, on the assumption that fourth quarter retail comparable store sales will remain stable as against prior year fourth quarter. (AR)
In its interim results, Hugo Boss said third quarter of 2015 sales declined 1 per cent excluding currency effects, but in euro terms, they increased 4 per cent from a year ago period to €744 million.
However, comparable store sales in company owned retail stores remained stable year-on-year in local currencies.
According to Hugo Boss, due to particularly challenging sales trends, EBITDA before special items dropped 8 per cent year on year to €168 million in the third quarter of 2015.
In addition, the Group's financial result was impacted by a negative charge of around €16 million related to adverse exchange rate movements of the Brazilian Real and the Swiss Franc in particular.
The company further added that while performance in Europe remained strong and in line with original expectations, momentum in Asia and the Americas deteriorated considerably during the reporting quarter.
“This was due to sales declines in China as well as a negative development in the Group's US own-retail and wholesale businesses and weaker demand from tourists contributed to the slowdown in the US,” it explained.
In light of weaker than expected trading in the third quarter, Hugo Boss has now forecast sales to increase between 3 and 5 per cent on a currency-adjusted basis in full year 2015.
Growth of EBITDA before special items is projected to range between 3 and 5 per cent, on the assumption that fourth quarter retail comparable store sales will remain stable as against prior year fourth quarter. (AR)
Fibre2Fashion News Desk – India
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