Hugo Boss, a Germany-based luxury fashion house, recently reported that its quarterly net profit plunged 84 per cent to US $ 12.25 million and sales dropped by 4 per cent. As a consequence of the poor results, the retailer will now be closing down some of its stores.
“The fashion house would shut another 20 stores and refocus on its US business as it cuts its full-year outlook following a drop-off in second quarter profits,” informs Mark Langer, Chief Executive of Hugo Boss adding that the decision has been taken to once again return to the profit making path. However, the market environment will remain challenging for the foreseeable future, adds Mark who replaced Claus-Dietrich Lahrs in the month of May for the position he is currently operating at. He wants the brand to focus more on menswear.
Also Read – Hugo Boss’ sales decline
Earlier in March this year, Hugo Boss announced closure of around 20 of its 145 stores in Greater China and 20 less-profitable stores globally in the next 18 months, with its strategy to focus on selling the brand at high-quality outlets in the US market in an effort to minimize discounting.
The fashion brand is now expecting its full-year currency adjusted sales to fall between 0 per cent and 3 per cent, while it expects earnings before interest, taxation, depreciation and amortization (EBITDA) before special items to fall between 17 per cent and 23 per cent.
