Hugo Boss Financials 2017

The HUGO BOSS Group is one of the leading companies in the premium segment of the global apparel market. With some 14,000 employees around the world, the Company,
which is based in Metzingen, Germany, develops and sells high-quality fashion as well as accessories in the womenswear and menswear segments under the BOSS and HUGO
brands. By means of a differentiated brand strategy, the Group positions the brands in different segments and increases their desirability. In fiscal year 2017, the Group achieved sales of EUR 2.7 billion from the distribution of classic yet modern tailoring, eveningwear, casualwear, shoes and leather accessories. HUGO BOSS produces 18% of its total sourcing volumes at its own facilities. 82% are sourced from external contract suppliers or procured as merchandise. Most of the partner factories are located in Eastern Europe and Asia, whereas the Group’s own production
facilities are based at four sites in Europe. These are located in Izmir (Turkey), Metzingen (Germany), Morrovalle (Italy) and Radom (Poland). BOSS and HUGO products can currently be purchased in 127 countries. The HUGO BOSS Group’s distribution activities are divided into three sales regions. With a share of 62%,
Europe contributes the largest proportion of sales. America and Asia account for 21% and 14% of sales generated respectively. Within these sales regions, the six core markets – Germany, Great Britain, France, Benelux, the United States and China – contribute a total of around 63% of sales. The BOSS and HUGO brands are sold via the Group’s own retail business and wholesale business, both bricks-and-mortar retail and online. Over the last few years, the share of sales generated by the Group’s own retail business has grown substantially. Today, it accounts for 63% (2016: 62%) of Group sales. The BOSS and HUGO brands are sold via the Group’s own retail business and wholesale business, both bricks-and-mortar retail and online. Over the last few years, the share of sales generated by the Group’s own retail business has grown substantially. Today, it accounts for 63% (2016: 62%) of Group sales. We analyse, briefly, the annual results of year 2017 of the company vs its 2016 results.

1. Sales By Region

Europe was the leading market for the year 2017 with about 1.6 billion Euros which constituted 62 % of the total sales with just a marginal 1% increase over last year. Americas with their share of 21% come next but again the performance was flat with a turnover of about Euro 570 million. Asian Pacific region comes next with a 14% turnover. The company did not show any growth during the year 2017 with a minor positive of 1% being a consolation . However, given the tough times for retailers, it may not be considered as a bad performance.

Regions	2017 (In Million Euro)	In % Of Sales	2016 (In Million Euro)	In % Of Sales	Change In %
Europe	1681	62	1660	61	1
Americas	577	21	582	22	-1
Asia/Pacific	396	14	382	14	4
Licenses	79	3	69	3	14
Total	2733	100	2693	100	1

2. Sales By Distribution Channels

Group focuses more on retail through its own shops and that is where over 60% of turnover is coming from. Wholesale is the next big segment with about 34% share.  The total sales for all the distribution channels for the year 2017 was 2733 million euro and in the year 2016 was 2693 million euro with 1 % change in the sales from 2016 to 2017. The percentage change in sales was positive for all channels except the wholesale channel which saw an negative change of –3%.

Channels	2017 (In Million Euro)	In % Of Sales	2016 (In Million Euro)	In % Of Sales	Change In %
Group’s Own Retail Business	1732	63	1667	62	3
· Directly Operated Stores	1103	40	1078	40	2
· Outlet	550	20	523	19	5
· Online	79	3	76	3	5
Wholesale	922	34	947	35	-3
Licenses	79	3	69	3	14
Total	2733	100	2693	100	1

3. Sales By Brand

Boss is really THE BOSS ! Accounting for over 85% of turnover , it really dominated the other brand HUGO. But the growth % in the HUGO brand was higher at 4% while BOSS lagged behind at 1%.

Particulars	2017 (In Million Euro)	In % Of Sales	2016 (In Million Euro)	In % Of Sales	Change In %
Boss	2336	85	2313	86	1
Hugo	397	15	380	14	4
Total	2733	100	2693	100	1

4. Sales By Gender

The sales of Hugo Boss by gender shows that the men’s wear contribution was about 8 times more that of the women’s wear for the year 2016 and 2017, the sales contribution of menswear for 2017 was 2440 million euro , similarly in the year 2016 the sales contribution of menswear was 2394 million euro with positive 2% change in sales from 2016 to 2017. The sales contribution of womenswear was 293 million euro in 2017 and in the year 2016 was 299 million euro with negative change of 2% in sales from 2016 to 2017. However, the total sales saw the positive change of 1% from 2693 million euro in 2016 to 2733 million euro in 2017.

Particulars See also Financial Results Denim Retailer Gap Posts Increased 3rd Quarter Profits in 2009	2017 (In Million Euro)	In % Of Sales	2016 (In Million Euro)	In % Of Sales	Change In %
Menswear	2440	89	2394	89	2
Womenwear	293	11	299	11	-2
Total	2733	100	2693	100	1

5. Stores Information

The stores count in Europe shows that the free standing stores were 192 stores, shops in shops were 351 and outlets were 65 stores , Europe has a largest stores in all out of the three region mentioned below with 608 stores. The stores count in America shows that free standing stores were 90 stores, shops in shops were 99 stores and outlets were 50 stores, America has the largest number of shops in shops. In Asia/Pacific the number of free standing stores were 157 stores, shops in shops were 88 and outlets were 47 stores.

2017	Free Standing Stores (In Numbers)	Shops in Shops (In Numbers)	Outlets (In Numbers)	Total
Europe	192	351	65	608
Americas	90	99	50	239
Asia/Pacific	157	88	47	292
Total	439	538	162	11

On the whole, we find that Hugo Boss did not grow in 2017 but managed to remain at the same level where many retailers have been hit hard. This by itself is an achievement .