• Outlook on business performance takes into account the expected financial impact of the spread of the coronavirus
  • Group sales performance in 2020 expected to be within a range of 0% to +2% adjusted for currency effects
  • EBIT in 2020 of between EUR 320 million and EUR 350 million expected

Subsequent events

At the time this report was prepared on February 20, 2020, the business of HUGO BOSS was significantly impacted by the spread of the novel coronavirus and the associated restrictions on public life, first and foremost in mainland China. Since late January, a large number of the Group’s own retail stores in mainland China, Hong Kong and Macau have been either closed or operate with severely limited opening hours. At the same time, the Company also recorded a noticeable decline in the sales generated from Chinese tourists in other key markets.

Against this backdrop and given the prevailing high levels of uncertainty regarding the ongoing development of this situation at the time of preparing this report, HUGO BOSS anticipates that the economic consequences of the spread of coronavirus are very likely to have a significant impact on the Group’s sales and profit development in 2020. This is taken into account in the estimates presented in this chapter regarding the expected business performance of HUGO BOSS in 2020. They also reflect the Company’s assumption that the situation should gradually normalize by the middle of the year. Any negative impact above and beyond this could cause the actual results in fiscal year 2020 to differ from the forecast. Report on Risks and Opportunities, Material External Risks


The following report presents the forecast of the Management of HUGO BOSS with respect to the Company’s future development and describes the expected development of significant macroeconomic and industry-specific conditions. It reflects the Management’s current knowledge at the time the report was prepared, while also taking into account the fact that, if the risks and opportunities materialize as described in the Risks and Opportunities section, actual developments may differ significantly from this forecast, either positively or negatively. Other than the statutory publication requirements, HUGO BOSS does not assume any obligation to update the statements contained in this report. Report on Risks and Opportunities

Economic and industry-specific developments have a major influence on the development of the Company’s operational and financial development. The Group’s outlook regarding its expected development is therefore based on certain assumptions about developments in the global economy and in the industry. However, these were taken from sources that were published before the spread of the coronavirus. These original assumptions are outlined in the following sections. The subsequent assessment of the expected business performance of HUGO BOSS in 2020 also take into account an estimate of the financial impact of the coronavirus on the Company.

Outlook for the global economy

In its report published on January 20, 2020, the IMF expects moderate recovery of growth in the global economy towards 3.3% in 2020 (2019: 2.9%). The outlook is based on the assumption of higher growth momentum for many important emerging markets. On the other hand, growth in many industrial countries and in China is expected to continue to slow down in 2020. Increasing geopolitical tensions and a further escalation of global trade conflicts are considered to represent significant risks to the development of the global economy.

According to the IMF, growth in the Eurozone in 2020 is expected to be 1.3% and thus only slightly above the growth achieved in the prior year (2019: 1.2%). Growth should be supported by an expected improvement in foreign demand. Assuming an orderly Brexit, a slight improvement in growth to 1.4% is also expected for the economy of Great Britain (2019: 1.3%). In the United States, on the other hand, economic growth is expected to decrease to 2.0% (2019: 2.3%). The decline primarily reflects the return to a neutral fiscal policy and the expected slowdown in the positive effects of low interest rates. According to the IMF, growth in China is also likely to weaken slightly and is expected to amount to 6.0% (2019: 6.1%). The planned reduction of import duties should have a positive impact on growth momentum and mitigate the economic slowdown somewhat.

Industry outlook

In a joint study published in November 2019, The Business of Fashion and management consultancy firm McKinsey & Company estimate that the global apparel industry will grow by 3% to 4% in 2020 and therefore slightly weaker than in the prior year (2019: 3.5% to 4.5%). For the upper premium segment of the apparel industry, which is perceived to be the best benchmark for HUGO BOSS, the growth rate is also expected to be slightly lower than in the prior year, amounting to 2.5% to 3.5% (2019: 3% to 4%). The expected slowdown results from an increasing reluctance of consumers against the backdrop of persistent macroeconomic and political uncertainties, as well as the continuing threat of trade conflicts. General Economic Situation and Industry Development

In the industrial countries in Europe, the industry is expected to grow at a low single-digit percentage rate in 2020 and thus more slowly than in the prior year. In this context, the tense global economic situation and the remaining uncertainties in connection with Brexit are expected to have a dampening effect on growth. For the Americas, industry growth is expected to slow down to a low single-digit percentage rate in 2020. Consumer spending should grow at subdued rates, reflecting ongoing trade conflicts and the forthcoming presidential election in the United States. According to The Business of Fashion and McKinsey & Company, industry growth in the emerging markets of Asia is also expected to slow down slightly in 2020. In the context of a softer consumer climate, the industry is expected to grow at a mid- to high single-digit percentage rate. In the course of this, mainland China is expected to develop significantly better than Hong Kong, which has been impacted by political unrest most recently. As in the prior year, growth at a low single-digit percentage rate is projected for the industrial countries of Asia.

Outlook for the HUGO BOSS Group

The outlook for fiscal year 2020 takes into account the effects of IFRS 16 and is based on the respective results for fiscal year 2019, also taking into account the effects of IFRS 16.

Against the backdrop of the macroeconomic and industry-specific conditions and taking into account the assessment of the expected financial impact of the coronavirus outlined in the “Subsequent events” section of this chapter, HUGO BOSS anticipates that Group sales will develop within a range of 0% to +2% in 2020, adjusted for currency effects. Growth is expected to vary across regions. While the Group expects currency-adjusted sales to increase at a low single-digit percentage rate in Europe, the Americas are expected to see a largely stable development of currency-adjusted sales. A persistently challenging market environment is likely to continue to weigh on the wholesale business in North America, particularly in the first half of 2020. Impacted by the economic consequences of the coronavirus, currency-adjusted sales in the Asia/Pacific region are expected to decline at a single-digit percentage rate.

For its own retail business, the Group expects currency-adjusted sales in 2020 to grow at a low to mid-single-digit percentage rate. Growth will be supported by the intensification of online partnerships in the concession model, as well as renovations of strategically important BOSS stores completed in 2019. Currency-adjusted sales in the wholesale business are expected to decrease by a low to mid-single-digit percentage rate. This will primarily be due to the anticipated sales shift from wholesale to the own retail business in connection with the intensification of the online concession model. Group Strategy, Focus on Implementing the Strategic Growth Drivers

HUGO BOSS expects operating result (EBIT) of between EUR 320 million and EUR 350 million in 2020 (2019: EUR 344 million), with final sales development being crucial to the amount of EBIT that can be expected. With respect to the Group’s net income, the Company anticipates an increase of up to 10%. This should also be supported by an improvement in the Group tax rate.

Against the backdrop of the continuing uncertainties regarding the spread of the coronavirus, HUGO BOSS expects trade net working capital as a percentage of sales to increase by around 50 basis points in 2020. Capital expenditure is expected to total EUR 140 million to EUR 160 million in 2020 (2019: EUR 192 million). The decrease in capital expenditure is mainly attributable to non-recurring investments for the new construction of the largest HUGO BOSS outlet globally close to the company’s headquarters in Metzingen. Investment activity will continue to focus on the Group’s own retail business and its IT infrastructure.

The Managing Board and the Supervisory Board intend to propose to the Annual Shareholders’ Meeting on May 7, 2020, a dividend of EUR 2.75 per share for the fiscal year 2019 (2018: EUR 2.70). The proposal is equivalent to a payout ratio of 93% of the Group’s net income attributable to the equity holders of the parent company in 2019 (2018: 79%). Assuming that the shareholders approve the proposal, the dividend will be paid out on May 12, 2020. Based on the number of shares outstanding at year-end, the amount distributed will come to EUR 190 million (2018: EUR 186 million).

Outlook 2020



Results 20191


Outlook 20201


Including the effects of IFRS 16.


On a currency-adjusted basis.

Group sales2


Increase by 2% to EUR 2,884 million


Development within a range of 0% to +2%

Sales by region2







Increase by 4% to EUR 1,803 million


Increase at a low single-digit percentage range



Decrease by 7% to EUR 560 million


Largely stable development



Increase by 5% to EUR 438 million


Decrease at a single-digit percentage rate

Sales by distribution channel2





Own retail business


Increase by 4% to EUR 1,869 million


Increase at a low to mid-single-digit percentage rate



Decrease by 3% to EUR 931 million


Decrease at a low to mid-single-digit percentage rate

Operating result (EBIT)


Decrease by 1% to EUR 344 million


EUR 320 million to EUR 350 million

Group's net income


Decrease by 13% to EUR 205 million


Increase of up to 10%

Trade net working capital as a percentage of sales


Increase by 40 basis points to 20.1%


Increase by around 50 basis points

Capital expenditure


EUR 192 million


EUR 140 million to EUR 160 million