German fashion house Hugo Boss on Wednesday raised its full-year outlook after reporting a 20% jump in second-quarter sales, as a brand revamp and marketing push helped it overcome sector-wide sluggish demand in China and the US The premium fashion group has stayed resilient in the slowing US and European markets while boosting sales in Asia despite China having a slower recovery than expected.
Its business in EMEA and the Americas benefited from a pick-up in tourism, Hugo Boss said, while currency-adjusted revenue in China increased 56% from a year earlier, making the Asia-Pacific region the strongest for the company.
In the first six months of the year the retailer opened 17 new Boss stores across all three regions, with a particular focus on China.
Group quarterly sales grew to 1.03 billion euros ($1.13 billion) on a currency-adjusted basis, from 878 million a year earlier, broadly in line with analysts’ expectations as both the Boss and Hugo brands gained market share especially among younger consumers.
The company expects its annual sales to grow 12% to 15% and reach 4.1 billion to 4.2 billion euros, compared with its previous forecast for about 10% growth to 4 billion euros.
“While the new guidance comes in line with where expectations already sit, it might still be perceived as conservative in context of the Q2 topline beat, notably if the solid topline momentum continues,” JP Morgan analysts said.
Hugo Boss forecasts its 2023 operating profit to grow 20% to 25% to a level of 400 million to 420 million euros, versus its prior range of 10% to 20%.
The brand recorded an acceleration in online sales, which were up 30% currency-adjusted from the same period in 2022. Shares of Hugo Boss were seen up 0.7% in early Frankfurt trade.