Hugo Boss’s chief executive said that its turnaround was beginning to bear fruit as the German fashion group’s profits climbed in the first quarter.
In the three months to the end of March, Boss’s net profits rose 25 per cent to €48m. The group’s preferred measure of earnings before income, tax, depreciation, amortisation and special items rose 4 per cent, which Boss said was down to tight cost and rebate control.
Overall sales rose 1 per cent to €651m in the first quarter compared to the same period last year, coming in above analysts’s estimates compiled by Bloomberg of €641m.
The company reported sales in China rose by 3 per cent in the first quarter helped by social media marketing activities. Europe also saw 3 per cent growth in sales in local currency terms with sales growing by 7 per cent in the UK. However, sales in the US fell 7 per cent after the company began limiting the sale of its BOSS brand through wholesale channels starting from the second quarter of last year.
Mark Langer, chief executive, who last year unveiled a plan to refocus Boss on its core suits business after an unsuccessful attempt to move into luxury, said that the numbers represented a “solid” start to the year.
“In Europe and Asia especially, we’ve been heading in a positive direction. Our strategic realignment is coming along well, and in some areas it’s already proving a success,” he said.
“In the next weeks, we will be presenting our new collections to the public. That’s an important milestone in implementing our strategy. I am convinced that, after this year of stabilization, we will return to profitable and sustainable growth.”