Clothing group Hugo Boss says net profit down 12.5 percent
Delayed effects from the economic crisis hurt first quarter results at the German clothing group Hugo Boss but the company said Thursday that 2010 sales should increase nonetheless.
It said its three months to March net profit fell 12.5 percent from a year earlier to 56 million euros (74 million dollars) while core earnings were off 12 percent at 92 million euros, a statement said.
"Considerably lower pre-order volumes from the recession-dominated year 2009 were still impacting sales in wholesale business," it said.
Sales dropped eight percent to 444 million euros and were particularly weak in Europe, where Hugo Boss still makes two thirds of its business.
The company saw signs of hope however "in the context of the generally improved market environment," and noted that sales in stores it operated itself gained 25 percent to 83 million euros in the first three months of the year.
For all of 2010, Hugo Boss forecast sales growth "in the single-digit percentage range," along with a "somewhat stronger" increase in core earnings owing to a restructuring programme begun last year.
It has closed loss-making outlets and opened others under its own management, focusing on China, other Asian countries and South America.
© 2010 AFP