Hugo Boss soars in Frankfurt, quarter above expectations and outlook confirmed

(Il Sole 24 Ore Radiocor) - Hugo Boss jumped on the Frankfurt Stock Exchange thanks to quarterly results that exceeded analysts' forecasts and confirmation of annual targets. The German fashion group gained more than five points, among the largest in the Stoxx Europe 600 index. Hugo Boss posted a revenue of EUR 999 million in the first quarter, slightly below the EUR 1.01 billion recorded a year earlier, but above the average analyst estimate of EUR 974 million. "In the first quarter, increased macro-economic uncertainties weighed heavily globally on consumer confidence and industry development. Especially in China, weak consumer confidence held back economic growth, resulting in a persistent weakening of local demand. In addition to this, the US market experienced a considerable deterioration in consumer spending as a reflection of the increased economic uncertainty,' the company explains.

"Consistent implementation of strategic growth initiatives supported the brand and limited the group's revenue decline on a currency-adjusted basis to 2% in the first quarter," the group said. The decline was 1% in the Emea region and the Americas, while it reached 8% in the Asia-Pacific region, where it was affected by weak demand in China. Gross margin remained stable and operating expenses are at last year's level, the company says. Ebit amounted to EUR 61 million compared to EUR 69 million in Q1 2024 and benefited from 'additional efficiency gains, resulting in a margin of 6.1%.

Net profit fell to 37 million from 41 million in the first three months of 2024. Hugo Boss shows optimism about the remainder of the financial year, confirming guidance for 2025 that points to "overall stable growth (-2% to +2%), Ebit up 5-22%, with a 9-10% margin. The group emphasises brand and product initiatives, 'including the launch of the first Boss collection with David Beckham in April'. Analysts at Stifel reaffirmed their 'Hold' recommendation on the stock with a price target of EUR 39, noting that the group posted results that exceeded expectations, in particular a 2% drop in sales compared to the consensus of -4%. "First quarter sales predict a return to positive sales growth in March," they said in a note. Ebit also exceeded expectations at 61 million compared to 49 million expected on average.