Hugo Boss Third Quarter Operating Profit Beats Expectations on Better Cost Control

New Hugo Boss logo and their website shop are seen in this illustration taken, May 17, 2024. (Reuters)
New Hugo Boss logo and their website shop are seen in this illustration taken, May 17, 2024. (Reuters)
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Hugo Boss Third Quarter Operating Profit Beats Expectations on Better Cost Control

New Hugo Boss logo and their website shop are seen in this illustration taken, May 17, 2024. (Reuters)
New Hugo Boss logo and their website shop are seen in this illustration taken, May 17, 2024. (Reuters)

Hugo Boss' third-quarter operating profit slightly beat market expectations on Tuesday, as the company reported a 1% increase in currency-adjusted group sales amid persistently weak demand in China.

Quarterly earnings before interest and tax (EBIT) were down 7% on the year at 95 million euros ($103.3 million), but above analysts' estimate of 90 million euros in a company-provided poll, helped by cost management, it said.

Hugo Boss shares were indicated 2.5% higher in Lang & Schwarz premarket trade.

"Estimates for the coming quarter should be anchored today," analysts at Jefferies wrote in a note to clients, highlighting improved sales in September, better cost control and Hugo Boss' confirmed guidance for the year.

After a 2022 brand revamp boosted its resilience last year, the upmarket fashion label has been grappling with weakening consumer demand despite increasing investment in marketing and production capacity in recent months.

Currency-adjusted sales were 1.029 billion euros during the three months, slightly up from 1.027 billion last year and broadly in line with market expectations of 1.023 billion euros.

"Particularly in China, the overall market environment was affected by persistent subdued consumer demand," the company said in a statement.

Quarterly currency-adjusted sales in its third-biggest market Asia/Pacific fell 7% to 110 million euros, but increased 1% in the Europe, Middle-East and Africa region and 4% in the Americas.

The company said improvements in Germany offset softer sales trends in France and in Britain, while it also saw further sales improvements in the United States.

Hugo Boss, which is taking additional measures to enhance efficiency and effectiveness, especially around sourcing, said it continued to focus on cost control to support profitability into the fourth quarter. It maintained its full-year sales and earnings forecasts after slashing them earlier this year.



Pandora’s 2024 Operating Profit Growth Now Seen at Upper End of Guided Range

Pandora said it now expects full-year organic operating profit growth of between 11% and 12%. (Getty Images for Pandora Jewellery)
Pandora said it now expects full-year organic operating profit growth of between 11% and 12%. (Getty Images for Pandora Jewellery)
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Pandora’s 2024 Operating Profit Growth Now Seen at Upper End of Guided Range

Pandora said it now expects full-year organic operating profit growth of between 11% and 12%. (Getty Images for Pandora Jewellery)
Pandora said it now expects full-year organic operating profit growth of between 11% and 12%. (Getty Images for Pandora Jewellery)

Denmark's Pandora , the world's biggest jewellery maker, said on Wednesday it now expects operating profit growth this year at the upper end of its forecasted range while it reported quarterly operating profit a tad below forecasts.

"We are very pleased with our strong results this quarter, particularly in the context of the current macroeconomic backdrop," CEO Alexander Lacik said in a statement.

Operating profit rose to 980 million Danish crowns ($140.87 million) in the third quarter from 920 million a year earlier, slightly below the forecast of 991 million in a company-compiled poll.

Pandora said it now expects full-year organic operating profit growth of between 11% and 12% compared to its previously guided range of 9-12%. The company also raised its outlook in May and August.

It still expects an operating margin this year of around 25%.