Hugo Boss announced a rise in earnings before income tax (EBIT) by 22.4% to €410m.
The German fashion brand attributed the growth to the strong brand momentum of BOSS and HUGO, fueled by the successful execution of several marketing, product, and distribution initiatives as part of the Company’s “CLAIM 5” growth strategy.
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Hugo Boss said fiscal year 2023 marked another important milestone for the company towards achieving its 2025 financial ambition, which the company raised in mid-2023.
By 2025, Hugo Boss aims to generate revenues of €5bn and an EBIT of at least €600m, representing an EBIT margin of at least 12%.
“We ended 2023 on a high note, making it a record year for Hugo Boss,” said Daniel Grieder, CEO. “The double-digit top- and bottom-line improvements in the important final quarter are all the more remarkable considering the current challenging global market environment. With our strong brand momentum and the ongoing successful execution of our ‘CLAIM 5’ strategy, we have laid a robust foundation for continuing our market-share-winning trajectory and making further progress in becoming one of the top 100 global brands.”
Pippa Stephens, senior apparel analyst at GlobalData, commented: “Hugo Boss has maintained its impressive upwards trajectory, as its pivot to more casual ranges and premium positioning have driven its desirability among consumers.
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By GlobalData“The group’s outperformance in FY2023 was widespread across all regions, with Asia Pacific seeing the strongest currency-adjusted revenue growth of 32%, due to COVID-19 restrictions affecting the comparative period. The Americas also experienced impressive success given the general slowdown in consumer spending in the region, with sales rising by 23%, thanks to its more casual designs increasingly resonating with American consumers who are now wearing its products day-to-day rather than just for more formal occasions. Though EMEA experienced the weakest growth of 13%, this is still no mean feat considering consumers’ squeezed incomes, as it will have been helped by some shoppers trading up as they prioritize value-for-money.
“Its smallest brand, Hugo, performed strongest throughout the year, growing by 19.8%, while Boss rose by 14.1%, with both supported by investments in its product offering and distribution. The launch of new sub-brand, Hugo Blue, in the summer of 2024 should also further drive Hugo’s appeal, with its focus on streetwear and gender-neutral designs hopefully allowing it to become even more attractive to the lucrative Gen Z demographic.
“Within Boss, womenswear had the greatest increase of 20.5%, compared to 13.5% for menswear, as it continues to build awareness among female shoppers through dedicated marketing campaigns and ambassadors like Gigi Hadid and Naomi Campbell.
“In terms of channels, digital rose by 23.1%, as e-commerce continues to be a focus for the group, while brick-and-mortar retail and wholesale grew by 12.2% and 15.4% respectively. Wholesale was most impacted by the market’s general slowdown in the final quarter, with growth decelerating to just 2.6%, as Hugo Boss retains less control over its brand image.
“The group is remaining cautious in its outlook for FY2024, anticipating its sales will grow between 3% and 6%, and that it will be slightly delayed in reaching its long-term sales goal of €5bn by 2025. However, after beating its guidance for the past couple of years, it will likely surpass expectations again.”
In January 2024, Hugo Boss booked a 13% jump in group sales to €1.17bn in the fourth quarter of 2023 as EBIT rose 17% to €121m on the back of strong brand momentum and successful execution of its Claim 5 strategy.
In 2023, Hugo Boss claimed to be the “first company” to invest in Collateral Good Ventures Fashion I, a climate-first venture capital fund designed to accelerate sustainability in the fashion industry.
