Hugo Boss AG · XETR:BOSS

Hugo Boss — Q1 2013 Earnings Presentation

29 slides from Hugo Boss's earnings presentation, May 2, 2013

  1. Slide 1: HUGO BOSS

    HUGO BOSS

  2. Slide 2: HUGO BOSS First Quarter Results 2013

    HUGO BOSS First Quarter Results 2013 Claus-Dietrich Lahrs (CEO) I Mark Langer (CFO) Metzingen, May 2, 2013 Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 2 / 31

  3. Slide 3: Agenda

    Agenda First Quarter Results Strategy Update Outlook Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 3 / 30

  4. Slide 4: Agenda

    Agenda First Quarter Results Strategy Update Outlook Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 5 / 31

  5. Slide 5: First quarter results reflect challenging economic environment and different timing of wholesale shipments

    First quarter results reflect challenging economic environment and different timing of wholesale shipments Sales EBITDA before special items (in EUR million) (in EUR million) (2)% (11)% 607 593 148 133 Q1 2012 Q1 2013 Q1 2012 Q1 2013 ((2)% fx-adjusted) Conference Call, First Quarter Results 2013 HUG

  6. Slide 6: Mixed regional sales performance

    Mixed regional sales performance Sales growth by region, y-o-y in EUR Q1 2013 fx-adjusted (in %) -5 Europe* -5 5 Americas 6 -2 Asia/Pacific 1 -2 Group -2 -6 -4 -2 0 2 4 6 8 ■ European performance burdened by timing of wholesale shipments and difficult market environment ■ Americas strongest growing

  7. Slide 7: Wholesale decline outweighs robust growth in own retail

    Wholesale sale decline outweighs robust growth in own retail Sales growth by channel, y-o-y in EUR Q1 2013 fx-adjusted (in %) -14 Wholesale -14 14 Retail 15 6 Royalties 6 -2 Group -2 -15 -10 -5 0 5 10 15 ■ Different phasing of deliveries and new collection cycle weigh on wholesale development ■ Cont

  8. Slide 8: Gross margin increase more than offset by higher operating expenses

    Gross margin increase more than offset by higher operating expenses in EUR million Q1 2013 Q1 2012 Change in % Net sales 593.5 606.8 (2) ■ Positive channel mix effect supports Gross profit 367.1 370.1 (1) gross margin increase in % of sales 61.8 61.0 0.8 pp Selling and distribution expenses (199.0)

  9. Slide 9: Group operating margin decrease reflected in regional profitability development

    Group operating margin decrease reflected in regional profitability development Segment profit Q1 2013 in % of Q1 2012 in % of Change in % in EUR million segment sales segment sales Europe* 133.7 36.5 148.7 38.6 (10) Americas 32.1 25.2 34.9 28.6 (8) Asia/Pacific 30.1 34.9 33.2 37.9 (9) Royalties 11.

  10. Slide 10: Trade net working capital below prior year level

    Trade net working capital below prior year level March 31, 2013 400 Inventories (5)% (7)% ■ Flexible sourcing and (in EUR million) production March 31, 2012 422 fx-adjusted ■ Expansion of Trade March 31, 2013 250 concession business receivables +5% +4% offsets positive effects (in EUR million) March

  11. Slide 11: Higher investments focused on infrastructure upgrade and own retail

    Higher investments focused on infrastructure upgrade and own retail Investments Free cash flow Net debt (in EUR million) (in EUR million) (in EUR million) >100% (29)% (12)% 31 7 141 124 5 15 Q1 2012 Q1 2013 Q1 2012 Q1 2013 March 31, 2012 March 31, 2013 ■ Own retail expansion ■ Ongoing cash generatio

  12. Slide 12: Completion of refinancing increases equity ratio to above 50%

    Completion of refinancing increases equity ratio to above 50% ■ New 5-year, EUR 450 million syndicated loan facility replaces old facility of same amount ■ Significantly lower loan utilization increases equity ratio to 52% ■ Favourable conditions to support improvement of Group interest charge Confe

  13. Slide 13: Agenda

    Agenda First Quarter Results Strategy Update Outlook Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 14 / 31

  14. Slide 14: Clear focus on execution of medium-term strategy

    Clear focus on execution of medium-term strategy STRENGTHENING MAXIMIZING OUR CONSUMER FOCUS BRANDS TO DRIVE RETAIL STRIVING FOR EXPLOITING OPERATIONAL GLOBAL EXCELLENCE GROWTH OPPORTUNITIES Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 15 / 31

  15. Slide 15: Growing excitement around Shanghai fashion show at the end of May

    Growing excitement around Shanghai fashion show at the end of May BOSS fashion show, Shanghai Power Station of Art Fall/Winter 2013 May 30, 2013 Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 16 / 31

  16. Slide 16: Amsterdam first of several new flagship store openings in 2013

    Amsterdam first of several new flagship store openings in 2013 BOSS Store, Amsterdam Leidsestraat Opening: March 2013 Net size: 779 sqm Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 17 / 31

  17. Slide 17: New store openings and shop-in-shop takeovers increase store count

    New store openings and shop-in-shop takeovers increase store count Number of own retail stores as of March 31, 2013 (December 31, 2012: 840) TOTAL 876 (+36) Openings: 45 thereof takeovers: 31 Closings: 9 EUROPE* 508 (+39) Openings: 41 thereof takeovers: 31 Closings: 2 AMERICAS 148 (+1) ASIA/PACIFIC

  18. Slide 18: Franchise business in Singapore to be taken over in August

    Franchise business in Singapore to be taken over in August BOSS Store Ngee Ann City, Takashimaya Singapore Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 19 / 31

  19. Slide 19: Agenda

    Agenda First Quarter Results Strategy Update Outlook Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 20 / 31

  20. Slide 20: 2013 financial outlook reconfirmed

    2013 financial outlook reconfirmed 2013 Outlook Sales growth (currency-adjusted) High single-digit Growth of EBITDA before special items 10% to 12% Growth of EBITDA before special items High single-digit Capex Increase on a comparable basis Own retail network Around 50 net organic openings Conferenc

  21. Slide 21: BACKUP

    BACKUP Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 21 / 29

  22. Slide 22: First quarter results at a glance

    First quarter results at a glance Sales Gross margin (in EUR million) (in %) +0.8pp (2)% 607 (2)% 593 61.0% 61.8% fx-adjusted Q1 2012 Q1 2013 Q1 2012 Q1 2013 EBITDA before special items Net debt (in EUR million) (in EUR million) (11)% (12)% 148 141 133 124 Q1 2012 Q1 2013 March 31, 2012 March 31, 20

  23. Slide 23: Profit & loss statement

    Profit & loss statement in EUR million Q1 2013 Q1 2012 Change in % 2012 2011 Change in % Net sales 593.5 606.8 (2) 2,345.9 2,058.8 14 Cost of sales (213.9) (224.2) 5 (849.2) (756.5) (12) Direct selling expenses (12.5) (12.5) 0 (43.5) (37.5) (16) Gross profit 367.1 370.1 (1) 1,453.2 1,264.8 15 in % o

  24. Slide 24: Trade net working capital

    Trade net working capital Average trade net working capital as a percentage of sales by quarter (in %) 29.7 30 28.5 27.2 24.6 (0.2)pp 25 20.8 21.0 20.2 20.1 20.0 20 15 10 5 0 Q1 2009 Q2 2009 Q3 2009 Q4 2009 … Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Conference Call, First Quarter Results 2013 HUGO BO

  25. Slide 25: Retail network

    Retail network Number of own retail stores: +1 +3 (9) +41 876 + 1 USA + 2 China 840 + 1 Australia + 26 Spain + 8 UK + 2 Netherlands + 1 Belgium + 1 Germany + 1 Italy + 1 Ireland + 1 Switzerland Dec. 31, 2012 Europe* Americas Asia/Pacific Closings March 31, 2013 *Europe incl. Middle East and Africa.

  26. Slide 26: Group sales split by distribution channel

    Group sales split by distribution channel Sales by distribution channel Retail 22% 45% 49% 55% Wholesale 75% 53% 49% 43% … Royalties 3% 2% 2% 2% 2005 2011 2012 2015e Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 29 / 31

  27. Slide 27: Financial calendar 2013

    Financial calendar 2013 Date Event May 2, 2013 First Quarter Results May 16, 2013 Annual Shareholders’ Meeting July 31, 2013 First Half Year Results October 31, 2013 Nine Months Results November 26, 2013 Investor Day, Hong Kong Conference Call, First Quarter Results 2013 HUGO BOSS © May 2, 2013 28 /

  28. Slide 28: Forward looking statements contain risks

    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 expressions

  29. Slide 29: HUGO BOSS

    HUGO BOSS

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