The German fashion group reported €59 million in EBIT, surpassing estimates, as margin gains offset a 9% decline in currency-adjusted sales.
Hugo Boss posted second-quarter EBIT of €59 million, exceeding the €52 million analysts expected, despite a 9% year-on-year drop in currency-adjusted sales to €905 million. The decline was driven by a 13% fall in EMEA sales to €532 million, with weak demand in Germany, the UK, and France, alongside softer store traffic in the Middle East.
Gross margin expanded 200 basis points to 64.9%, supported by sourcing efficiencies, higher pricing, and increased full-price sales. Operating expenses fell 4%, while free cash flow before leases reached €105 million. Inventories dropped 15% year-on-year, signaling tighter inventory management.
The company maintained its full-year guidance, forecasting a mid- to high-single-digit percentage decline in currency-adjusted sales and EBIT between €300 million and €350 million. Frasers’ €38-per-share takeover offer remains on the table.