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Hugo Boss reports strong China rebound in June
[BERLIN] German fashion house Hugo Boss returned to strong growth in China in June and saw online sales jump 74 per cent in the second quarter, even as it reported an overall 59 per cent fall in sales for the period due to lockdowns.
Shares in the company, down 47 per cent this year, rose 2.3 per cent in early trade.
Analysts at Baader Helvea noted the company was particularly exposed as people have been shifting to more casual wear during the coronavirus pandemic, cutting demand for the smart suits for which it is particularly known.
Hugo Boss reported quarterly revenue of 275 million euros (S$444.8 million), missing an average analyst forecast for 288 million euros, while its operating loss of 124 million euros was ahead of consensus for a loss of 133 million euros.
It said it had seen a less pronounced fall in sales of casual wear and "athleisure" than in formal wear, with products like T-shirts, polo shirts, trousers and lounge wear proving their resilience.
Hugo Boss is currently led by finance chief Yves Mueller after Mark Langer stepped down as chief executive officer (CEO). Daniel Grieder, the former CEO of Tommy Hilfiger Global & PVH Europe, is due to take over as CEO on June 1, 2021.
Sales rose 4 per cent in the quarter in mainland China, including double-digit growth in June, a similar trend to that reported by LVMH, the world's biggest luxury goods group, which said last week that momentum had especially improved in China.
By contrast sales fell 59 per cent in Europe and 82 per cent in the Americas, with unrest and demonstrations in the United States in May and June putting more strain on its business.
The company expects a gradual improvement for the second half of 2020, but declined to provide a full-year forecast.