Hugo Boss will be back to double-digit growthWednesday, 31 October 2012
"The change in our collection cycle has led to a sales shift in our wholesale business from the third into the fourth quarter. This had an adverse impact on our traditionally strong earnings in the third quarter," Chief Executive Claus-Dietrich Lahrs said.
However, "We shall, however, return to double-digit growth in sales and earnings in the fourth quarter with our winter business," he added.
In the period from July to September, net profit fell by 12 percent to 103.6 million euros and underlying profit was down 7.0 percent at 165.4 million euros, while sales advanced by 5.0 percent to 646.3 million euros, reported AFP.
But despite the Asian generalized slowdown, the German fashion house said it was seeing some signs of improvement in China, with sales picking up there in the third quarter. "We do see stabilization but no recovery in consumer confidence in China yet," CEO said in the company's quarterly report on Tuesday.
Even with an adverse as ever environment, Hugo Boss showed they are confident in reaching their full-year targets despite the weaker results. "We're confident that we can achieve our full-year targets despite the difficult economic environment," assured Lahrs.
Hugo Boss expects a currency-adjusted gain in sales of 10 percent for 2012 and underlying profit of between 10 and 12 percent.
Shares in Hugo Boss have lost 13 percent of their value over the last three months.
Lars Lusebrink, an analyst at Analysts at Independent Research set his price target for Hugo Boss at 88 euro and maintains his "buy" recommendation. Meanwhile, UBS has a slightly lower price target for the stock, taking into account that figures for the third quarter decreased. The Swiss bank has reduced its target price from 85 to 84 euros, but keeps its "Buy".