Following today’s release of Hugo Boss’ figures for the three months ending 30 June 2024; Pippa Stephens, senior apparel analyst at GlobalData, a leading data and analytics company, offers her view: “Hugo Boss’ sales declined for the first time since the pandemic in Q2 FY2024, falling by 1.1% to €1.0bn, a notable downturn from the growth of 4.8% it experienced in Q1, as it belatedly feels the impact of the challenging economic environment in its key markets. This led its H1 revenue growth to come through at just 1.8%, with this slower trajectory now expected to persist in the short term, driving the group to lower its FY2024 guidance to growth of just 1% to 4%, after previously anticipating a rise of between 3% and 6%. While its operating profit also fell a stark 42.1% in Q2 to €70m, Hugo Boss does foresee improvements in this in H2 thanks to cost efficiencies, expecting it to land between €350-430m, which would be between a decline of 15% and a rise of 5% on the year.
“Though growth was muted across all markets, the Americas performed most strongly in Q2 FY2024, with currency-adjusted sales rising by 5%, as its high quality, premium offering continues to resonate with consumers in the region. EMEA saw revenue fall by 2%, as shoppers’ finances remain squeezed due to high inflation, with the UK one of its poorest performing regions, as it faces some of the greatest economic challenges. While Hugo Boss also experienced a slowdown in other major countries like France and Germany, emerging markets in EMEA saw double-digit growth, owing to their developing economies and the group being less established there. Asia Pacific saw the greatest decline of 4%, however, this was primarily dragged down by China, where consumers have been cutting back their spending amid the debt crisis in the property sector. In contrast, Southeast Asia and the Pacific were much more positive, with sales rising by high-single digits.
“Hugo Boss’ digital and brick-and-mortar retail channels experienced declines of 3.6% and 2.9%, respectively, with the former particularly hindered by a downturn through partner sites. Conversely, brick-and-mortar wholesale increased by 5.4%, as its recent collections were well received by its partners. Across its brands, HUGO saw the strongest uplift of 2.7%, aided by the launch of its new sub-brand HUGO BLUE at the beginning of the year, with its streetwear aesthetic helping it appeal to the lucrative Gen Z demographic. BOSS womenswear and menswear grew by 1.5% and fell by 2.0% respectively. However, the brand is focussing on initiatives to drive momentum in the remainder of the year, partnering with David Beckham on a multi-year design collaboration as well as a campaign alongside Naomi Campbell launching at the end of August. This should help to boost visibility of BOSS and bring it back to the forefront of consumers’ minds.”
