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Currency-adjusted sales grow 8% at Hugo Boss in Q2
Aug '14
Currency-adjusted sales rose 8% in the second quarter of 2014, at luxury and fashion group - Hugo Boss. However currency effects negatively impacted this development. 
In Euro terms, the Group recorded an increase of 5% to EUR 559 million against EUR 532 million in second quarter of 2013. Europe made a particular contribution to this development, posting currency-neutral sales growth of 10%. 
In the Americas, growth in local currencies picked up pace compared to the previous quarter to reach 7%. Adjusted for currency effects, sales in Asia were up 2% on the previous year. 
EBITDA margin increased by 60 basis points in the second quarter ending June 30, 2014.
Hugo Boss said that the wholesale business was burdened in the second quarter by a challenging market environment, the takeover of selling spaces previously managed by wholesale partners as well as delivery shifts to the third quarter. 
Overall, revenues in this distribution channel were 6% below the prior-year level on a currency-adjusted basis. Currency-neutral sales in the Group's own retail business (including outlets and online business), in contrast, rose by 17%. On a comparable store basis, currency-adjusted revenue growth in this channel came to 4%. 
The disproportionately fast growth in owned retail stores as well as lower markdowns led to a gross profit margin increase of 150 basis points to 66.7% against 65.2% in the corresponding quarter of 2013. 
Thanks to the solid sales performance and the healthy growth of the gross profit margin, EBITDA before special items showed a stronger increase than sales, rising by 8% to EUR 110 million compared to EUR 102 million in the same period of previous year. 
Due to which, adjusted EBITDA margin expanded by 60 basis points to 19.7% in the second quarter against 19.1% in second quarter of last year. Supported by a significant decrease in net financial expenses, consolidated net income rose by 18% to EUR 63 million compared to EUR 53 million. 
Hugo Boss CEO Claus-Dietrich Lahrs said, "Our consistently strong growth in Europe and our upturn in the Americas form the basis of these very solid quarterly results. Despite the persistently difficult environment in some key markets, we will grow even faster in the second half of the year, particularly in terms of earnings.” 
He added, “We will expand our presence and brand strength in womenswear so as to secure long-term, profitable growth following on from this year's double-digit sales increases". 

Fibre2fashion News Desk – India

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