Hugo Boss AG · XETR:BOSS
Hugo Boss — FY2006 Earnings Presentation
37 slides from Hugo Boss's earnings presentation, Mar 21, 2007
Slide 1: HUGO BOSS
HUGO BOS S$
Slide 2: Balance Sheet Press Conference March 21, 2007
Balance Sheet Press Conference March 21, 2007 Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 2 / 37
Slide 3: HUGO BOSS 2006
HUGO BOSS 2006 • Net sales EUR 1,495.5 million (+14% versus previous year) • Gross margin EUR 854.5 million (+17% versus previous year) • EBIT EUR 184.4 million (+13% versus previous year) • Income before taxes EUR 179.9 million (+14% versus previous year) • Net income EUR 128.7 million (+19% versus
Slide 4: HUGO BOSS 2006 share price and market capitalization
HUGO BOSS 2006 • Share price common share (12/31/2006) EUR 41.00 (+34% versus previous year) • Share price preferred share (12/31/2006) EUR 38.92 (+31% versus previous year) • Market capitalization (12/31/2006) EUR 2,815 million (+ EUR 695 million versus previous year) • DAX development (12/31/2006)
Slide 5: Strategic Growth Areas
Strategic Growth Areas BOSS Womenswear Shoes and Leather Accessories Directly Operated Stores • Turnover EUR 162 m • Turnover EUR 151 m • Turnover EUR 192 m • Growth +69% • Growth +28% • Growth +39% Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 5 / 37
Slide 6: Sales by Region
Sales by Region 2006 2005 Change 2006 EUR mill. EUR mill. in % sales split in % Germany 346.9 318.4 9 23 Other European countries 681.9 582.5 17 46 Americas 273.6 233.4 17 18 Asia / other regions 150.1 134.2 12 10 Royalties 43.0 40.9 5 3 TOTAL 1,495.5 1,309.4 14 100 Balance Sheet Press Conference Ma
Slide 7: Sales by Brand
Sales by Brand 2006 2005 Change EUR mill. EUR mill. in % BOSS 1,347.9 1,167.5 15 Menswear 1,185.7 1,071.8 11 Womenswear 162.2 95.7 69 HUGO 136.2 124.5 9 Others 11.4 17.4 (34) TOTAL 1,495.5 1,309.4 14 Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 7 / 37
Slide 8: BOSS Menswear
BOSS Menswear • Market presence in 106 countries with more than 4,600 points of sale (apparel only) • Sales split - Businesswear 49% - Leisurewear 41% - Shoes and Leather Accessories 10% • BOSS Stores achieve 37% of net sales • BOSS Selection grows 62% and achieves EUR 33 million net sales in 59 cou
Slide 9: BOSS Womenswear
BOSS Womenswear • Market presence in 69 countries with more than 1,200 points of sale (apparel only) • Sales split - Businesswear 48% - Leisurewear 36% - Shoes and Leather Accessories 16% • BOSS Stores achieve 63% of net sales • 11% share of total net sales 2002 2003 2004 2005 2006 Net sales in EUR
Slide 10: Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG ©
Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 10 / 37
Slide 11: Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG ©
Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 11 / 37
Slide 12: Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG ©
Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 12 / 37
Slide 13: HUGO
HUGO • Market presence in 48 countries with more than 1,100 HUGO Menswear points of sale and 370 HUGO Womenswear points of sale (apparel only) • Sales split - HUGO Menswear 75% - HUGO Womenswear 25% • HUGO Stores achieve 28% of net sales Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 1
Slide 14: Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG ©
Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 14 / 37
Slide 15: Shoes and Leather Accessories
Shoes and Leather Accessories • Shoes and leather accessories complement all our fashion lines • Sales split - Menswear 81% - Womenswear 19% • 10% share of total net sales Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 15 / 37
Slide 16: Royalties
Royalties • The licensed out product groups fragrances, eyewear and watches achieve EUR 43 million (+5% versus previous year) • With Safilo SpA, the new license partner for eyewear, the new collections have been introduced in the second half of the year • Successful launch of “Femme by BOSS“ und con
Slide 17: Directly Operated Stores
Directly Operated Stores • 210 own stores (+65 versus previous year) in 16 countries, thereof - 67 freestanding Stores (+20 versus previous year) - 143 shop-in-shops (+45 versus previous year) • 6% sales increase on comparable selling space • 13% share of total net sales Balance Sheet Press Conferen
Slide 18: HUGO BOSS Stores by Region
HUGO BOSS Stores by Region Market presence in 76 countries with 1,051 Stores, thereof - 375 freestanding Stores - 676 shop-in-shops 2006 2005 Germany 187 156 Other European countries 470 370 Americas 113 104 Asia / other regions 281 247 TOTAL 1,051 877 Share of net sales in % 39 34 Balance Sheet Pre
Slide 19: Highlights 2006 Berlinale
Highlights 2006 BERLINALE Balance Sheet Press Conference March 21, 2007 HUGO BOSS © 19 / 37
Slide 20: Highlights 2006 Hockenheimring
Highlights 2006 HOCKENHEIMRING “25 YEARS PARTNERSHIP HUGO BOSS & MCLAREN MERCEDES“ Balance Sheet Press Conference March 21, 2007 HUGO BOSS © 20 / 37
Slide 21: Highlights 2006 BOSS Store Hawaii Waikiki
Highlights 2006 BOSS STORE HAWAII WAIKIKI Balance Sheet Press Conference March 21, 2007 HUGO BOSS © 21 / 37
Slide 22: Highlights 2006 BOSS Fashion Show Mexico City
Highlights 2006 BOSS FASHION SHOW MEXICO CITY Balance Sheet Press Conference March 21, 2007 HUGO BOSS © 22 / 37
Slide 23: Highlights 2006 HUGO BOSS Store Shanghai
Highlights 2006 HUGO BOSS STORE SHANGHAI Balance Sheet Press Conference March 21, 2007 HUGO BOSS © 23 / 37
Slide 24: Highlights 2006 HUGO BOSS Prize New York
Highlights 2006 HUGO BOSS PRIZE NEW YORK Balance Sheet Press Conference March 21, 2007 HUGO BOSS © 24 / 37
Slide 25: Sales Trends 2007 by Region
Sales Trends 2007 by Region 2007 2006 EUR mill. Germany Ò 346.9 Other European countries Ò 681.9 Americas Ò 273.6 Asia / other regions Ò 150.1 Royalties Ò 43.0 TOTAL Ò 1,495.5 Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 25 / 37
Slide 26: Earnings Trends 2007
Earnings Trends 2007 2007 2006 EUR mill. Sales Ò 1,495.5 Gross margin Ò 854.5 in % of sales Ò 57.1 EBIT Ò 184.4 Income before taxes Ò 179.9 Net income Ò 128.7 Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 26 / 37
Slide 27: Employees – by Region
Employees – by Region 2006 2005 Change Full-time equivalents in % Germany 2,104 1,911 10 Other European countries 4,795 4,262 13 Americas 1,167 1,063 10 Asia / other regions 375 348 8 TOTAL 8,441 7,584 11 Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 27 / 37
Slide 28: Employees – by Function
Employees – by Function 2006 2005 Change Full-time equivalents in % Production / Logistics 5,334 4,992 7 Sales / Creation / Marketing 2,441 2,025 21 Administration 666 567 17 TOTAL 8,441 7,584 11 Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 28 / 37
Slide 29: Income Statement
Income Statement 2006 2005 Change EUR mill. EUR mill. in % Sales 1,495.5 1,309.4 14 Cost of materials incl. changes in inventories (641.0) (577.7) (11) Gross margin 854.5 731.7 17 in % of sales 57.1 55.9 Other operating income and expenses (343.3) (289.3) (19) Personnel expenses (277.8) (238.2) (17)
Slide 30: Income Development
Income Development EUR mill. Net income 2005 108.2 Change in gross margin 122.8 Effect of sales volume on gross margin 100.2 Effect from changes in the gross margin percentage 20.5 Change in royalties 2.1 Change in operating expenses and depreciation / amortization (101.3) From other operating expen
Slide 31: Analysis of Financial Requirements
Analysis of Financial Requirements 2006 2005 Change EUR mill. EUR mill. in % Trade receivables, other assets1 215.0 196.8 9 Inventories 290.2 265.7 9 Trade payables and other liabilities1 (174.1) (146.6) (19) Current provisions (32.4) (36.4) 11 Net current assets2 298.7 279.5 7 Non-current assets 34
Slide 32: Free Cashflow
Free Cashflow 2006 2005 Change EUR mill. EUR mill. in% absolute Net income 128.7 108.2 19 20.5 Depreciation / amortization 49.0 41.3 19 7.7 Change in pension provisions 7.8 4.4 77 3.4 Cashflow 185.5 153.9 21 31.6 Net additions to fixed assets (89.3) (75.7) (18) (13.6) Change in remaining net capital
Slide 33: Appendix
Appendix Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 33 / 37
Slide 34: Disclaimer
Disclaimer Forward-looking Statements Contain Risks This document contains forward-looking statements that reflect management's current views with respect to future events. The words "anticipate“, "assume“, "believe“, "estimate“, "expect“, "intend“, "may“, "plan“, "project“, "should" and similar exp
Slide 35: Financial Calendar
Financial Calendar March 21, 2007 Annual Press and Analyst Conference April 26, 2007 Publication of the First Quarter Report 2007 May 10, 2007 Annual Shareholders‘ Meeting in Stuttgart August 01, 2007 Publication of the Interim Report January - June 2007 November 06, 2007 Publication of the Third Qu
Slide 36: Internet Address www.hugoboss.com
Internet Address Contents Languages Annual Report German Interim Report English www.hugoboss.com Financial Presentations Investor Relations Calendar Stock Prices Press Releases Balance Sheet Press Conference March 21, 2007 HUGO BOSS AG © 36 / 37
Slide 37: HUGO BOSS
HUGO BOS S$