Hugo Boss shares plunge after suitmaker cut its outlook
Company expects currency-adjusted sales to increase by a low single-digit percentage
Hugo Boss now expects an operating profit of between €330 million and €340 million. It previously forecast an increase from last year’s €347 million.
Hugo Boss slashed its outlook for the financial year, saying economic uncertainty in North America and political unrest in Hong Kong are crimping sales of the German company’s fashions.
The company was trading down over 13 per cent following the news.
The guidance reduction comes only two months after the suitmaker previously lowered its outlook following a sales decline in the US, where it cited weak sales to tourists and a high level of apparel discounting. Now the anti-Beijing protests in Hong Kong, which led to a plunge in visits by mainland Chinese luxury shoppers, are creating a new headache.
“Business in Hong Kong has been substantially negatively affected since the beginning of the political unrest and demonstrations,” the company said in a statement.
Luxury conglomerate LVMH said earlier that August and September sales in Hong Kong fell 40 per cent, though the company compensated for the decline with gains elsewhere.
Hugo Boss said it expects currency-adjusted sales to increase by a low single-digit percentage, down from previous guidance for an increase at the lower end of a mid-single-digit range. The change came after the company said sales in the third quarter were flat from a year earlier.
The suitmaker also now expects an operating profit of between €330 million and €340 million. It previously forecast an increase from last year’s €347 million.