Hugo Boss sales grew 3 per cent in 2024 to €4.3 billion. The group expects macroeconomic and geopolitical volatility to remain challenging in 2025, with performance negatively impacted by consumer sentiment.
“When we presented our initial outlook for fiscal year 2024, we were openly speaking more optimistically about the opportunities that the year could bring at the global scale,” CEO Daniel Grieder told investors in a call on Thursday. “It was our ambition to make further progress towards our midterm financial target [of €5 billion]. However, over the course of the year, we had to accept that both the world and our industry were impacted by numerous macroeconomic and geopolitical challenges.”
The company reported stronger-than-expected sales growth in the fourth quarter, up 6 per cent compared with analyst consensus of 2 per cent.
However, its outlook for 2025 is cautious: sales are projected to remain roughly flat, between €4.2 billion and €4.4 billion (ranging from a 2 per cent decline and a 2 per cent increase). EBIT is expected to grow between 5 and 22 per cent as it plans to improve efficiencies.
2025 will be the final year of Hugo Boss’s ‘Claim 5’ strategy, which Grieder introduced in 2021 upon joining the brand. The strategy involves five pillars to turn around performance: boost brands, product is king, lead in digital, rebalance omnichannel and organise growth. Initially, the company had been aiming to reach €5 billion in sales by 2025, but when it reported its 2023 results last year, it warned that target would be delayed. “We remain confident that the €5 billion [sales target] and 12 per cent EBIT line is absolutely doable with all we invested into the brand in the past three years and these pillars we put into the business format [...] in terms of timing, we are just slightly delayed,” Grieder said. He declined to set a specific timeline for reaching the €5 billion sales target.
By market, the Americas showed the strongest momentum in 2024, with sales up 8 per cent, while EMEA (Europe, the Middle East and Africa) sales grew 3 per cent thanks to improvements in Germany, and Asia-Pacific sales dropped 2 per cent due to continued challenges with consumer demand in China.
With regards to tariffs, Grieder said the company does not yet have any plans to adjust prices in reaction, but said: “We have to see how it is developing in the next few weeks and months.” CFO Yves Müller added: “Over the last three years, we have already decreased our sourcing from China from mid-teens to a number below 5 per cent, so we are well prepared on the other side. This whole tariff discussion creates a lot of uncertainty here and there, so we have to observe the situation but we are very much convinced that we have a successful supply chain to respond to different challenges.”
By brand, Boss Menswear and Boss Womenswear both saw sales increase 3 per cent, while Hugo grew 5 per cent.
Bricks-and-mortar wholesale grew 8 per cent in 2024, but bricks-and-mortar retail dropped 1 per cent, with a decline in store traffic partly offset by an increase in sales per transaction (the channel returned to growth in Q4). Digital sales, accounting for 20 per cent of the group’s overall sales, grew 6 per cent.
EBIT declined from €410 million in 2023 to €361 million, impacted by retail impairments. Gross margin improved 30 basis points thanks to improved efficiency in sourcing, while the company was able to slow its growth in operating expenses thanks to better cost efficiencies.
“We are determined to further improve our profitability in the years to come, to capitalise on our organisational strength and leverage the great potential of our company, our commitment to generating profitability, profitable growth and creating long term shareholder values has never been stronger,” Grieder said.
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