Hugo Boss Ag · XETR:BOSS

Hugo Boss — Investor Presentation (March 2024)

105 slides from Hugo Boss's investor presentation, Mar 7, 2024

Slide 3: Vision and Mission
PAGE 3 VISION MISSION BECOME THE PREMIUM TECH- WE LOVE DRIVEN FASHION FASHION, PLATFORM WE CHANGE WORLDWIDE FASHION © 2022 HUGO BOSS
Slide 4: Ambition
PAGE 4 AMBITION BILLION SALES IN 2025+ EBIT MARGIN IN 2025 BECOME ONE OF THE TOP 100 GLOBAL BRANDS
Slide 5: Claim 5 Strategy
PAGE 5 CLAIM 5 STRATEGY WHY CONSUMER FIRST WHAT 1 2 3 4 5 BOOST PRODUCT LEAD IN DRIVE ORGANIZE BRANDS IS KEY DIGITAL OMNICHANNEL FOR GROWTH SUSTAINABLE THROUGHOUT HOW RIGOROUS EXECUTION EMPOWER PEOPLE AND TEAMS
Slide 6: We Have Achieved a Lot
PAGE 6 LOOKING BACK WE HAVE ACHIEVED A LOT
Slide 7: Strong Acceleration in Top-Line Growth Leads to Market Share Gains
PAGE 7 STRONG ACCELERATION IN TOP-LINE GROWTH LEADS TO SIGNIFICANT MARKET SHARE GAINS GROUP SALES EBIT MARGIN 4.2 B 2023 2022 2021 1.9 B 2020 8.2% 9.2% 9.8% -12.1% 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2023 2024 2025
Slide 8: Significant Increase in Brand Value
PAGE 8 SIGNIFICANT INCREASE IN BRAND VALUE BEST GLOBAL BRANDS 2023 BECOME ONE OF THE +37% +22% +26% TOP 100 2021 2022 2023 GLOBAL BRANDS
Slide 9: 1st Place in Brand Heat Ranking
PAGE 9 BOSS MAINTAINS 1ST PLACE IN BRAND HEAT RANKING ALSO IN 2023 *THE BRAND HEAT INDEX IS AN INTERNAL RANKING DEVELOPED WITH MARKET RESEARCH FIRM IPSOS.
Slide 10: 2025 Financial Ambition
PAGE 10 2025 FINANCIAL AMBITION CLAIM 5 UPDATE
Slide 11: Execution of Claim 5 to Impact Financial Ambition
PAGE 11 EXECUTION OF CLAIM 5 TO IMPACT FINANCIAL AMBITION VALUE OUTLOOK INVESTOR Continue CREATION Business operations DAY 2023 top-line platform to support SHIFTS TO growth gross margin PROFITABILITY IMPROVEMENTS AND FREE CASH FLOW GENERATION Further invest Accelerate in marketing, store portfolio
Slide 12: New 2025 Financial Ambition
PAGE 12 NEW 2025 FINANCIAL AMBITION 1 2 2025 INITIAL 2025 NEW GROUP SALES 3 in 2025 5 B in 2025 SALES GROWTH 6% CAGR 2019 2025 10% CAGR 2019 2025 EBIT ~ 600 M EBIT MARGIN ~12% OF GROUP SALES OF GROUP SALES 1 Initial targets as provided in August 2021. 2 Targets as provided in June 2023. 3 As macroec
Slide 13: Top-Line Ambition
PAGE 13 TOP-LINE AMBITION ▪ Building on regained brand momentum and 10% leveraging global growth CAGR opportunities 6% +25% ▪ Balanced growth between space CAGR 3.7 B expansion, volume and price 2019 2022 2025 1 2025 2 INITIAL AMBITION AMBITION 1 Initial targets as provided in August 2021. 2 Targets
Slide 14: Balanced Growth Profile to Continue
PAGE 14 BALANCED GROWTH PROFILE TO CONTINUE ACROSS BRANDS, BRANDS CHANNELS, ~ ~ ~ 1.0 B AND REGIONS BOSS MENSWEAR BOSS WOMENS- HUGO WEAR CHANNELS > ~ 1.3 B > BRICK-AND-MORTAR RETAIL BRICK-AND-MORTAR WHOLESALE DIGITAL LICENSES REGIONS >55% ~20% ~20% EMEA AMERICAS ASIA/PACIFIC LICENSES
Slide 15: Bottom-Line Development
PAGE 15 BOTTOM-LINE DEVELOPMENT COMMITTED TO ACHIEVE 12% EBIT MARGIN BY 2025 EBIT MARGIN (IN % OF GROUP SALES) EBIT MARGIN ▪ Gross margin 2025 improvements to support EBIT margin development 12% ~12% ▪ Investments in operating overhead and fulfilment to weigh on operating expenses EBIT Gross Brand D
Slide 16: Store Network Optimization
PAGE 16 STORE NETWORK OPTIMIZATION DEVELOPMENT OF FREESTANDING RETAIL STORES UNTIL 2025 OPTIMIZATION AND SELECTIVE EXPANSION OF STORE NETWORK TO CAPITALIZE ON BRAND MOMENTUM 489 ~500 2023 STORES 2025 STORES ▪ Further optimizing store network remains key priority ▪ Store productivity to increase by a
Slide 17: Operating Overhead Costs and Fulfilment
PAGE 17 OPERATING OVERHEAD COSTS AND FULFILMENT FUTURE GROWTH AMBITION TO BE BACKED BY STRONG AND EFFICIENT COST SAVINGS ORGANIZATION INVESTMENTS ▪ Higher fulfilment costs to support top-line growth by 2025 and beyond ▪ Setting up best-in-class organization for future growth and profitability ▪ Over
Slide 18: Capital Expenditure
PAGE 18 CAPITAL EXPENDITURE RATIO OF GROWTH VS. MAINTENANCE CAPEX OF AROUND 40/60 CAPITAL EXPENDITURE (IN % OF GROUP SALES) CAPEX 2023-2025 >80% of capital expenditure 08 related to store network, logistics expansion, and 07 digital excellence ~6-7% 06 Corporate Other 05 B&M development retail 04 Di
Slide 19: Trade Net Working Capital
PAGE 19 TRADE NET WORKING CAPITAL TRADE NET WORKING CAPITAL TO AIMED AT A LEVEL BETWEEN 16% AND 18% TNWC (IN % OF GROUP SALES) ▪ Inventory optimization 28 initiatives to support TNWC 24 ▪ Inventories in % of sales to improve to a level of <20% by 2025 20 16-18% 16 12 2019 2020 2021 2022 2023 2024* 2
Slide 20: Driving Organic Growth to Generate Shareholder Return
PAGE 20 DRIVING ORGANIC GROWTH TO GENERATE SHAREHOLDER RETURN CAPITAL ALLOCATION FRAMEWORK 01 02 03 04 REINVEST FOR PROGRESSIVE STRATEGIC RETURN EXCESS ORGANIC ABSOLUTE INVESTMENTS LIQUIDITY TO GROWTH DIVIDEND SHAREHOLDERS PAYMENTS Investments Payout ratio M&A Special dividend 30-50% Share buyback
Slide 21: Boost Brands
PAGE 21 01 01 01 BOOST BRANDS 01 CLAIM 1 01
Slide 22: Two Clearly Distinguished Brands
PAGE 22 WE REVITALIZED OUR BRAND PORTFOLIO STRATEGY AND BRAND ARCHITECTURE WITH TWO CLEARLY DISTINGUISHED BRANDS POSSIBILITY TO ADD MORE BUSINESSES WITH PREMIUM LIFESTYLE POSITIONING
Slide 23: Be Your Own BOSS
PAGE 23 BE YOUR OWN BOSS 24/7 BOSS addresses customers in the LIFESTYLE premium segment who lead a self- determined life, show a clear attitude, and pursue ambitions with determination BOSS offers the perfect outfit for every occasion from business to leisure with casualness and comfort being key at
Slide 24: HUGO Your Way
PAGE 24 HUGO YOUR WAY HUGO targets customers who consider their way of dressing as an expression of their individual personality and who see themselves as trendsetters HUGO offers a broad range of trendy and modern products reflecting the brand s authentic and unconventional style
Slide 25: Continuous Focus on Brand Building Initiatives
PAGE 25 CONTINUOUS FOCUS ON BRAND BUILDING INITIATIVES TO FUEL RELEVANCE OF BOSS AND HUGO REINFORCE LEVERAGE INTRODUCE CREATE UNIQUE TWO-BRAND FULL POTENTIAL NEW WAYS BRAND STRATEGY IN OF BOSS TO REACH MOMENTS CONSUMERS AND HUGO YOUNGER TO INCREASE MIND BRAND LINES CONSUMERS BRAND RELEVANCE BOOST BR
Slide 26: Clearly Distinguished Marketing
PAGE 26 CLEARLY DIFFERENT LIFESTYLE DISTINGUISHED BRANDS MARKETING STRATEGIES DIFFERENT TARGET GROUPS DIFFERENT MARKETING APPROACHES © 2023 HUGO BOSS
Slide 27: Maximize Consumer Impact
PAGE 27 OVERALL MARKETING STRATEGY ▪ Marketing investments to remain at 7-8% of Group sales ▪ Activate consumers across all touchpoints ▪ Continue a digital-first marketing strategy ▪ Become culturally relevant through sports, music, arts, and collabs ▪ Sustainably connect with consumers through emo
Slide 28: Product Is Key
PAGE 28 02 02 02 PRODUCT IS KEY 02 CLAIM 2 02
Slide 29: Brand Lines Reflect BOSS Menswear 24/7 Lifestyle Promise
PAGE 29 BRAND LINES REFLECT BOSS MENSWEAR 24/7 LIFESTYLE PROMISE FROM HIGH-END TO MODERN BOLD SMART AND DENIM TO AN ACTIVE TAILORING PERFORMANCE CASUAL COMPETENCE... LIFESTYLE HERITAGE... SUITS... STYLES... BOSS CAMEL BOSS BLACK BOSS ORANGE BOSS GREEN
Slide 30: Product Strategy BOSS Menswear
PAGE 30 PRODUCT STRATEGY BOSS MENSWEAR ▪ Amplify the brand DNA own the ~ heritage in suiting in a modern way 2025 AMBITION* ▪ Offer products to wear 24/7 from morning to evening ▪ Keep the momentum and sharpen the collection to consumer and regional needs ▪ Claim price-value leadership across catego
Slide 31: Brand Lines Reflect BOSS Womenswear 24/7 Lifestyle Promise
PAGE 31 BRAND LINES REFLECT BOSS WOMENSWEAR 24/7 LIFESTYLE PROMISE FROM HIGH-END TO MODERN BOLD SMART AND DENIM INTO AN ACTIVE TAILORING TAILORING... CASUAL COMPETENCE... LIFESTYLE HERITAGE... STYLES... BOSS CAMEL BOSS BLACK BOSS ORANGE COLLABS
Slide 32: Product Strategy BOSS Womenswear
PAGE 32 PRODUCT STRATEGY BOSS WOMENSWEAR ▪ Offer products to wear 24/7 from ~ morning to evening 2025 AMBITION* ▪ Foster cohesive aesthetic between BOSS Menswear and Womenswear communication ▪ Amplify brand DNA translate heritage in suiting into new business wear and create true hero products ▪ Furt
Slide 33: HUGO Celebrates 24H Self-Expression
PAGE 33 HUGO CELEBRATES 24H SELF-EXPRESSION IN EVERY SITUATION Modern and authentic HUGO style to gain relevance among younger and young- minded consumers Balanced offer of commercial and contemporary pieces WORK CELEBRATE HANG OUT EXPLORE MOVE Investment in new categories such as womenswear bodywea
Slide 34: Product Strategy HUGO
PAGE 34 PRODUCT STRATEGY HUGO ▪ Foster cohesive aesthetic between ~ 1.0 B Menswear and Womenswear 2025 AMBITION* ▪ Balance out commercial and more contemporary designs ▪ Mix tailoring and streetwear for HUGO RED and push clothing, jersey, and outerwear ▪ Leverage HUGO BLUE to grasp growth opportunit
Slide 35: Two Brand Lines with Dedicated Styles
PAGE 35 TWO BRAND LINES WITH DEDICATED STYLES AND COMMON BRAND VALUES HUGO RED WITH A HUGO BLUE STRONG FOCUS ON EMPHASIZES STREET TAILORING COMMERCIAL FOR FASHION- STYLES WITH DENIM FORWARD AT THE CORE CONSUMERS
Slide 36: Global Licenses Business Extends 24/7 Lifestyle Promise
PAGE 36 GLOBAL LICENSES BUSINESS EXTENDS 24/7 LIFESTYLE PROMISE FRAGRANCES EYEWEAR WATCHES & KIDSWEAR HOME JEWELRY WRITING & DOG GOLF APAC CYCLING EQUESTRIAN LUGGAGE GIFTS ACCESSORIES
Slide 37: Lead in Digital
PAGE 37 03 03 03 LEAD IN DIGITAL 03 CLAIM 3 03
Slide 38: Constantly Developing Digital Capabilities
PAGE 38 CONSTANTLY DEVELOPING DIGITAL CAPABILITIES TO EMPHASIZE SPEED, PERSONALIZATION, AND COST EFFICIENCY DESIGN & PRODUCTION SALES & DEMAND DEVELOPMENT & LOGISTICS MARKETING Trend Product Modular product Digital Metaverse Digital Showroom Advanced analytics detection creation development Twin exp
Slide 39: Shifting Towards Trend Analytics with Data and Generative AI
PAGE 39 SHIFTING TOWARDS TREND ANALYTICS BY THE HELP OF DATA INSIGHTS AND GENERATIVE AI GENERATIVE AI CREATES NEW SPACES FOR CREATIVITY. IDENTIFY IMPROVE WIN KEY EMERGING TIME-TO-MARKET WITH RELEVANT TRENDS CONSUMER GROUPS DESIGN & PRODUCTION SALES & DEMAND DEVELOPMENT & LOGISTICS MARKETING
Slide 40: Foster Digital Product Creation
PAGE 40 FOSTER DIGITAL PRODUCT CREATION TO ACCELERATE DESIGN AND DEVELOPMENT PROCESS DIGITAL PRODUCT CREATION TO INCREASE EFFICIENCY, REDUCE COSTS, AND FURTHER OPTIMIZE QUALITY. ~55% ~65% >90% DIGITAL STYLE DIGITAL STYLE DIGITAL STYLES CREATION CREATION TARGETED WINTER 2023 2023 BY 2025 DESIGN & PRO
Slide 41: Launch of a Digital Twin
PAGE 41 LAUNCH OF A DIGITAL TWIN TO BUILD THE BACKBONE OF FUTURE GROWTH DIGITAL TWIN ENABLES SMART DECISION-MAKING BY CONNECTING PLANNING AND EXECUTION, FROM DEMAND TO SUPPLY. SUSTAIN BOOST INCREASE GROWTH PROFITABILITY SUPPLY CHAIN TRANSPARENCY DESIGN & PRODUCTION SALES & DEMAND DEVELOPMENT & LOGIS
Slide 42: Digital Innovation in Retail
PAGE 42 DIGITAL INNOVATION IN RETAIL AS AN INTEGRAL PART OF OUR GROWTH JOURNEY VIRTUAL STYLING enabling virtual try-ons based on personalized mannequins IN-STORE DIGITALIZATION adding new digital touchpoints into stores to create an attractive point of access to products and services RFID TECHNOLOGY
Slide 43: Leveraging Data to Improve Merchandising Processes
PAGE 43 LEVERAGING DATA TO IMPROVE OUR MERCHANDISING PROCESSES AND INCREASE EFFICIENCY IN RETAIL MERCHANDISE OPERATIONS ADVANCED MARKDOWN DATA-DRIVEN MANAGEMENT INTER-STORE TRANSFER Drive efficient end-of-season pricing by Optimization and automation of transfers automatically finding optimal markdo
Slide 44: Drive Omnichannel
PAGE 44 04 04 04 DRIVE OMNICHANNEL 04 CLAIM 4 04
Slide 45: Omnichannel
PAGE 45 WE MOVE TO WHERE CONSUMERS EXPECT US TO BE RETAIL WHOLESALE OMNICHANNEL DIGITAL METAVERSE
Slide 46: Leveraging Our High-Quality Channel Mix
PAGE 46 LEVERAGING OUR HIGH-QUALITY CHANNEL MIX TO REFLECT NEW REALITIES 2025 AMBITION KEEP MAINTAIN ADAPT RETAIL WHOLESALE DIGITAL AT AT TO >50% ~25% >20% OF GROUP SALES OF GROUP SALES OF GROUP SALES
Slide 47: Experiential in Retail
PAGE 47 EXPERIENTIAL IN RETAIL ACTIONS ENABLERS > ▪ Become THE place to be ▪ Experiential store design, for our customers pop-ups, and digitalization at the POS ▪ Enhance customer experience with a desirable ▪ Valuable hospitality concept look and feel AMBITION 2025* ▪ Excellence in store ▪ Increase
Slide 48: Investing Up to Store Portfolio
PAGE 48 INVESTING UP TO STORE PORTFOLIO NUMBER OF FULL-PRICE STORES 489 ~500 ~25% ~40% ~80% of stores refreshed of stores refreshed of stores to be refreshed 2023 2025 AMBITION by end of 2022 by end of 2023 by end of 2025
Slide 49: Increase Store Productivity
PAGE 49 INCREASE STORE PRODUCTIVITY BY AT LEAST 3% PER YEAR STORE PRODUCTIVITY ( ▪ Accelerate rollout of latest store concepts +4% VS. 2022 ▪ Continue store optimization program ▪ Constantly improve product offering at the POS 12,400 >13,000 2023 2025 AMBITION
Slide 50: Win with the Winners in Wholesale
PAGE 50 WIN WITH THE WINNERS IN WHOLESALE ACTIONS ENABLERS ~ ▪ Leverage brand lines ▪ Strong positioning of brands and focused product offering ▪ Grow with existing strong partners ▪ Strong relationship based on customer and product ▪ Drive digital selling and AMBITION 2025* insights automated reple
Slide 51: Exploit the Full Potential of Global Franchise Business
PAGE 51 EXPLOIT THE FULL POTENTIAL OF OUR GLOBAL FRANCHISE BUSINESS FOCUS ON EXPANDING NUMBER OF IN EMERGING MARKETS FRANCHISE STORES 2023 ~60 AMERICAS 2023 ~210 EMEA ~350 ~500 2023 ~80 2023 TARGET 2025+ ASIA/PACIFIC
Slide 52: Inspirational in Digital
PAGE 52 INSPIRATIONAL IN DIGITAL ACTIONS ENABLERS > 1.0 B ▪ Expand and grow ▪ Localized content and hugoboss.com marketing ▪ Improve user experience and ▪ Latest app skills and AI- push mobile and social driven features commerce AMBITION 2025* ▪ Data-driven decision-making ▪ Grow with strong digital
Slide 53: Leveraging Potential of hugoboss.com
PAGE 53 LEVERAGING POTENTIAL OF HUGOBOSS.COM BY DELIVERING NEXT-LEVEL DIGITAL EXPERIENCE DESIRABLE CONTENT DESIGNED PERSONALIZED STORYTELLING AND AND ADAPTED TO CUSTOMER JOURNEY BRAND CONTENT LOCAL NEEDS LEVERAGING AI INCREASED PAGE VALUE HIGHER TRAFFIC NEW CUSTOMERS HIGHER CONVERSION
Slide 54: Keep Growth Trajectory in the Americas
PAGE 54 KEEP GROWTH TRAJECTORY IN THE AMERICAS HIGH SINGLE-DIGIT GROWTH CAGR 2022 2025* ▪ Continue to push 24/7 brand image in our single largest market, the U.S. ~20% ▪ Further expand visibility in U.S. department stores and roll out digital marketplaces ▪ Strengthen store network in Latin America
Slide 55: Exploit Growth Momentum in EMEA
PAGE 55 EXPLOIT GROWTH MOMENTUM IN EMEA MID TO HIGH SINGLE-DIGIT GROWTH CAGR 2022 2025* ▪ Continue to enhance and upgrade distribution network >55% ▪ Accelerate franchise development ▪ Capitalize on business opportunities across brand lines SALES SHARE 2025 * Targets as provided in June 2023. As mac
Slide 56: Unleash the Full Potential in Asia/Pacific
PAGE 56 UNLEASH THE FULL POTENTIAL IN ASIA/PACIFIC LOW DOUBLE- DIGIT GROWTH CAGR 2022 2025* ▪ Secure affordable luxury position in China, Japan, and Korea ▪ Strengthen retail and drive ~20% wholesale in South East Asia & Pacific ▪ Boost digital commerce SALES SHARE 2025 * Targets as provided in June
Slide 57: Organize for Growth
PAGE 57 05 05 05 ORGANIZE FOR GROWTH 05 CLAIM 5 05
Slide 58: Stepping Up Investments in Our Logistics Network
PAGE 58 STEPPING UP INVESTMENTS IN OUR LOGISTICS NETWORK TO SUPPORT GROWTH AMBITION LOGISTICS CAPACITY PLANNED LOGISTICAL EXPANSIONS OWN USA ~65M ~90M OPERATIONS GERMANY THIRD-PARTY UK UNITS CAPACITY UNITS CAPACITY PROVIDER IN 2023 MID-TERM CHINA
Slide 59: Izmir Expansion
PAGE 59 SUCCESSFUL EXPANSION OF OUR OWN PRODUCTION CAPACITIES ~20% >5% OF TOTAL OF GLOBAL PRODUCTION CASUALWEAR CAPACITY SOURCING DEDICATED TO COMING FROM IZMIR IZMIR CASUALWEAR 17% * OWN PRODUCTION EXPANSION THEREOF ~15%* IN IZMIR, TURKEY * IN % OF TOTAL SOURCING AND PRODUCTION VOLUME
Slide 60: Advancing with Nearshoring
PAGE 60 ADVANCING WITH NEARSHORING TO BETTER ALIGN REGIONAL SOURCING ACTIVITIES WITH SALES MARKETS GROW IN THE SELECTIVELY REDISTRIBUTE AMERICAS EXPAND EMEA WITHIN APAC SOURCING VOLUMES BY REGION ~10% MID-TERM ~50% MID-TERM ~40% MID-TERM AMBITION AMBITION AMBITION 2% CURRENT 52% CURRENT 46% CURRENT
Slide 62: Strong Achievements in Sustainability
PAGE 62 STRONG ACHIEVEMENTS IN THE AREAS OF SUSTAINABILITY 7X LISTED IN STRATEGIC PARTNERSHIP DOW JONES HEIQ AEONIQ, SUSTAINABILITY A CELLULOSIC INDEX FILAMENT YARN
Slide 63: Five Strategic Sustainability Pillars
FUTURE PAGE 63 FUTURE OUR STRATEGY IS ANCHORED IN THESE CORE PRINCIPLES FUTURE OUR 5 STRATEGIC SUSTAINABILITY PILLARS FUTURE 1 2 3 4 5 FUTURE FUTURE INCREASE CIRCULARITY DRIVE DIGITIZATION & DATA ANALYTICS LEVERAGE NATURE POSITIVE MATERIALS FIGHT MICROPLASTICS PUSH ZERO EMISSIONS FUTURE A STRONG ENV
Slide 64: Dedicated Goal Behind Each Strategic Pillar
FUTURE PAGE 64 FUTURE THERE IS A DEDICATED GOAL BEHIND EACH STRATEGIC PILLAR FUTURE OUR 5 STRATEGIC SUSTAINABILITY PILLARS FUTURE FUTURE FUTURE 80% 90% CIRCULAR products products 100% natural materials 0% polyester & nylon -50% CO2 FUTURE by 2030 will be developed according to by 2030 emissions digi
Slide 65: Strategic Pillars Backed by Strong ESG Basis
PAGE 65 FUTURE FUTURE OUR 5 STRATEGIC PILLARS FUTURE ARE BACKED BY A STRONG ESG-BASIS FUTURE HUMAN RIGHTS & EMPLOYEE ANIMAL ENVIRONMENTAL PACKAGING SOCIAL COMPLIANCE DEVELOPMENT WELFARE COMPLIANCE STANDARDS • The upholding of human • We offer our employees • HUGO BOSS adheres to • We have comprehens
Slide 67: Double-Digit Top- and Bottom-Line Improvements
PAGE 67 2023 DOUBLE-DIGIT TOP- AND BOTTOM-LINE IMPROVEMENTS GROUP SALES 4,197 +18% +15% CURRENCY-ADJUSTED IN GROUP CURRENCY EUR MILLION VS. FY 2022 EBIT 410 +22% EUR MILLION VS. FY 2022
Slide 68: Strong Brand Momentum Drives Revenues for BOSS and HUGO
PAGE 68 STRONG BRAND MOMENTUM DRIVES REVENUES FOR BOSS AND HUGO +16% * +24% * +22% * *CURRENCY-ADJUSTED VS. FY 2022 VS. FY 2022 VS. FY 2022 BOSS BOSS HUGO MENSWEAR WOMENSWEAR © 2022 HUGO BOSS
Slide 69: Double-Digit Revenue Growth Across All Regions
PAGE 69 DOUBLE-DIGIT REVENUE GROWTH ACROSS ALL REGIONS AMERICAS EMEA ASIA/PACIFIC +23% +13% +32% * * * * VS. FY 2022 VS. FY 2022 VS. FY 2022 Double-digit growth across key Momentum in European markets Business recovery in Greater China *CURRENCY-ADJUSTED markets leads to additional market supported
Slide 70: Record Strong Sales Improvements at All Consumer Touchpoints
PAGE 70 ALL CONSUMER TOUCHPOINTS RECORD STRONG SALES IMPROVEMENTS B&M RETAIL B&M WHOLESALE DIGITAL +15% +18% +26% * ** * * VS. FY 2022 VS. FY 2022 VS. FY 2022 Growth driven by Strong momentum with Double-digit revenue comp store sales increases at *CURRENCY-ADJUSTED strategic partners, increases as
Slide 71: Gross Margin Slightly Below Prior-Year Level
PAGE 71 GROSS MARGIN SLIGHTLY BELOW PRIOR-YEAR LEVEL DESPITE SUPPORT FROM LOWER FREIGHT COSTS IN 2023 2022 Freight Product Rebates Channel FX 2023 cost 61.8% 61.5% (30) bp © 2023 HUGO BOSS
Slide 72: Strong Bottom-Line Improvements Despite Ongoing Investments
PAGE 72 STRONG BOTTOM-LINE IMPROVEMENTS DESPITE ONGOING INVESTMENTS INTO BUSINESS FY 2023 CHANGE GROSS MARGIN 61.5% (30) BP LOWER FREIGHT COSTS LARGELY OFFSET BY HIGHER PRODUCT COSTS AND REBATES OPERATING EXPENSES (IN % OF SALES) 51.7% IMPROVEMENT DRIVEN BY FURTHER EFFICIENCY GAINS IN B&M RETAIL (90
Slide 73: Normalization in Inventories Successfully Initiated
PAGE 73 NORMALIZATION IN INVENTORIES SUCCESSFULLY INITIATED ABSOLUTE AND RELATIVE DEVELOPMENT OF INVENTORIES Year over year, inventories increased by 11% currency-adjusted 1,154 INVENTORIES IN % OF SALES INVENTORIES IN EUR MILLION 1,129 Majority of inventories related to core 1,065 1,066 and fresh m
Slide 74: Step-Up in Capex Weighs on Free Cash Flow
PAGE 74 STEP-UP IN CAPITAL EXPENDITURE WEIGHS ON FREE CASH FLOW DEVELOPMENT FY 2023 FY 2023 FY 2023 TRADE NET CAPITAL FREE CASH WORKING CAPITAL EXPENDITURE FLOW 870 20.8% EUR MILLION IN % OF SALES 298 EUR MILLION 96 EUR MILLION +46%* +580BP +55% (42)% * CURRENCY-ADJUSTED Increase mainly reflects hig
Slide 75: Overproportionate Increase in Dividend Proposal
PAGE 75 OVERPROPORTIONATE INCREASE IN DIVIDEND PROPOSAL COMPARED TO NET INCOME DEVELOPMENT 60% +35% DIVIDEND PAYOUT RATIO 50% 30 50% EUR PAYOUT RATIO 40% 1.35 36% EUR EUR 1.00 35% 33% 30% 0.70 1.00 EUR 20% EUR EUR 2021 2022 20231 2024E 2025E 0.04 0.04 2019 2020 2021 2022 2023 2 2 1 DIVIDEND PER SHAR
Slide 77: Outlook for Fiscal Year 2024
PAGE 77 OUTLOOK FOR FISCAL YEAR 2024 Results 2023 Outlook 2024 Increase within a range of Group sales Increase by 15% to EUR 4,197 million 3% to 6% Sales by region Increase in the low to EMEA Increase by 11% to EUR 2,562 million mid single-digit percentage range Increase in the mid- to Americas Incr
Slide 78: Sales Outlook
PAGE 78 SALES OUTLOOK remains primary focus in 2024 +3% TO +6% Further market share gains targeted for the fiscal year 2024 4.30 TO 4.45 EUR BILLION Macroeconomic and geopolitical uncertainties to weigh on consumer 4.2 2024E sentiment in the short term EUR BILLION 2023 © 2022 HUGO BOSS
Slide 79: Sales Outlook by Region
PAGE 79 SALES OUTLOOK BY REGION ALL GEOGRAPHIES EXPECTED TO GROW IN 2024 AMERICAS EMEA ASIA/PACIFIC MID- TO HIGH LOW- TO MID- HIGH SINGLE- TO SINGLE-DIGIT SINGLE-DIGIT LOW DOUBLE-DIGIT VS. FY 2023 VS. FY 2023 VS. FY 2023 Further market share gains targeted Muted consumer sentiment in Long-term busin
Slide 80: 2025 EBIT Margin Ambition Reconfirmed
PAGE 80 2025 EBIT MARGIN AMBITION RECONFIRMED SALES TARGET MIGHT BE SLIGHTLY DELAYED SALES BY 2025+ EBIT MARGIN BY 2025 12% © 2022 HUGO BOSS
Slide 81: EBIT Outlook
PAGE 81 EBIT OUTLOOK Further profitability improvements targeted in 2024 +5% TO +15% EBIT margin to improve to a level of 10.0% to 10.7% in 2024 430 TO 475 EUR MILLION Realizing efficiency gains through increased focus on 410 2024E operational flexibility EUR MILLION and execution 2023 © 2022 HUGO B
Slide 82: Gross Margin Development Supported by Sourcing Efficiency
PAGE 82 GROSS MARGIN DEVELOPMENT SUPPORTED BY INCREASED SOURCING EFFICIENCY 2023 2025 Gross margin to range between 62% and 64% in +50BP TO 250BP 2024 and 2025 Strong efficiency gains by leveraging global sourcing 61.5% 62% TO 64% activities MATERIAL COSTS EFFICIENCIES PRODUCT/ SOURCING Product/mate
Slide 83: Ongoing Optimization of Cost Base
PAGE 83 ONGOING OPTIMIZATION OF COST BASE TO DRIVE FURTHER OPERATING LEVERAGE REDUCTION OF REVIEW OF OPTIMIZATION ENHANCEMENT COLLECTION MARKETING OF GENERAL OF COST COMPLEXITY EFFICIENCY ADMIN COSTS EFFICIENCY IN B&M RETAIL 2025 EBIT-MARGIN TARGET OF SUPPORTED BY OPERATING LEVERAGE © 2022 HUGO BOSS
Slide 84: Free Cash Flow Development
PAGE 84 FREE CASH FLOW DEVELOPMENT 2024 2025 2021 2025 Cash-generative business model in place FREE CASH FLOW in EUR MILLION Reacceleration in FCF generation targeted, 560 starting in fiscal year 2024 ~500 ~500 Optimization in TNWC and increased CapEx efficiency to fuel FCF development 166 96 2021 2
Slide 85: Our Commitment: Leveraging Growth Opportunities While Driving Efficiencies
PAGE 85 LOOKING BACK // SUMMARY DANIEL OUR COMMITMENT LEVERAGING GROWTH OPPORTUNITIES WHILE DRIVING EFFICIENCIES AND PROFITABILITY © 2022 HUGO BOSS
Slide 86: Financial Calendar & Investor Relations Contact
PAGE 86 FINANCIAL CALENDAR & INVESTOR RELATIONS CONTACT MAY CHRISTIAN STÖHR 2 FIRST QUARTER 2024 RESULTS SENIOR VICE PRESIDENT INVESTOR RELATIONS E-MAIL christian_stoehr@hugoboss.com PHONE +49 7123 94 80903 2024 LENA BIBERACHER SENIOR INVESTOR RELATIONS MANAGER CONTACT E-MAIL lena_biberacher@hugobos
Slide 88: Five Strong Reasons for an Investment in HUGO BOSS
PAGE 88 FIVE STRONG REASONS FOR AN INVESTMENT IN HUGO BOSS TWO STRONG BOSS and HUGO are two strong brands that are clearly distinguished by their fashionable style but 1 BRANDS meet the same high standards of quality and fit, innovation and sustainability. A 24/7 approach ensures that customers are
Slide 89: HUGO BOSS at a Glance
PAGE 89 HUGO BOSS AT A GLANCE 4.2 EUR BILLION 410 EUR MILLION 9.8% EBIT 96 EUR MILLION SALES EBIT MARGIN FREE CASH FLOW 131 ~ 19,000 19% 6,400 COUNTRIES EMPLOYEES SHARE OF POINTS DIGITAL SALES OF SALE © 2022 HUGO BOSS
Slide 90: Comparison of Actual and Forecast Business Performance
PAGE 90 COMPARISON OF ACTUAL AND FORECAST BUSINESS PERFORMANCE Results 2022 Initial forecast 2023 Latest forecast 2023 Results 2023 Group sales Increase at a mid-single-digit Increase of 12% to 15% to +15% (+18% FX adj.) EUR 3,651 million percentage rate EUR 4.1 billion to EUR 4.2 billion to EUR 4.2
Slide 91: Sales and Earnings Development of the Business Segments in 2023
PAGE 91 SALES AND EARNINGS DEVELOPMENT OF THE BUSINESS SEGMENTS IN 2023 © 2022 HUGO BOSS
Slide 92: Sales by Brand
PAGE 92 SALES BY BRAND 2023 BOSS BOSS HUGO MENSWEAR WOMENSWEAR 78% 7% 16% of Sales of Sales of Sales 3,256 EUR MILLION 288 EUR MILLION 653 EUR MILLION © 2022 HUGO BOSS
Slide 93: Global Market Presence
PAGE 93 HUGO BOSS GLOBAL MARKET PRESENCE AMERICAS EMEA ASIA/PACIFIC 23% 61% 14% of Sales of Sales of Sales 955 EUR million Sales 2,562 EUR million Sales 576 EUR million Sales ~1,900 Points of sale ~5,300 Points of sale ~600 Points of sale 115 Freestanding retail stores 162 Freestanding retail stores
Slide 96: Retail Store Network
PAGE 96 RETAIL STORE NETWORK 1,418 TOTAL INCLUDING FREE- NUMBER OF STANDING STORES, RETAIL POINTS SHOP-IN-SHOPS AND OF SALE OUTLETS © 2022 HUGO BOSS
Slide 97: Sourcing Footprint
PAGE 97 SOURCING FOOTPRINT WELL BALANCED REGIONAL SOURCING & PRODUCTION MIX REGIONALLY BALANCED OWN PRODUCTION COMPLEMENTS STRATEGIC SOURCING MIX THIRD-PARTY SOURCING ACTIVITIES 15% Izmir, Turkey (Largest single Americas External Sourcing Own Production source of production) EMEA Asia 2% 83% 17% 52%
Slide 98: Strong Organizational Set-Up
PAGE 98 STRONG ORGANIZATIONAL SET-UP EMPLOYEES IN MANAGEMENT (2023) EMPLOYEE SATISFACTION 77% CONDUCTED ANNUALLY WITH GREAT PLACE TO WORK® GERMANY © 2022 HUGO BOSS
Slide 99: Compensation System
PAGE 99 COMPENSATION SYSTEM STRONGLY SUPPORTING LONG-TERM TARGETS STI LTI Components Short-term variable compensation Long-term variable compensation Performance EBIT SALES Trade net Relative Return on Employee Perfor- Targets working total capital satisfaction mance in capital shareholder employed
Slide 100: Share Price Performance in 2023
PAGE 100 SHARE PRICE PERFORMANCE IN 2023 1 Burberry Group plc, Capri Holdings Ltd., G-III Apparel Group, Guess Inc., Levi Strauss & Co., Moncler Group, PVH Corp., Ralph Lauren Corp., SMCP Group, Tapestry Inc., VF Corp. © 2022 HUGO BOSS
Slide 101: Shareholder Structure
PAGE 101 SHAREHOLDER STRUCTURE SHAREHOLDER STRUCTURE INSTITUTIONAL INVESTORS AS OF DEC 31, 2023 (FREE FLOAT) BY REGION (IN % OF SHARE CAPITAL) AS OF DEC 31, 2023 (IN %) PFC S.r.l./Zignago Own shares Free float Rest of World ~40,000 Holding S.p.A. 2% 15% 2% 83% Rest of TOTAL NUMBER OF Europe 30% SHAR
Slide 102: Condensed Statement of Financial Position
PAGE 102 CONDENSED STATEMENT OF FINANCIAL POSITION (IN EUR MILLION) Assets December 31, December 31, 2023 2022 Property, plant, and equipment, intangible assets, right-of-use assets 1,521 1,356 Inventories 1,066 974 Trade receivables 376 256 Other assets 363 393 Cash and cash equivalents 118 147 Ass
Slide 103: Multi-Year Overview Sales
PAGE 103 MULTI-YEAR-OVERVIEW SALES 2023 2022 2021 2020 2019 2018 2017 Sales (in EUR million) 4,197 3,651 2,786 1,946 2,884 2,796 2,733 Sales by brand BOSS Menswear 3,256 2,868 2,181 1,530 2,488 2,422 2,336 BOSS Womenswear 288 239 192 131 HUGO 653 545 413 285 396 374 397 Sales by segments EMEA 2,562
Slide 104: Multi-Year Overview P&L, Balance Sheet and Other Key Figures
PAGE 104 MULTI-YEAR-OVERVIEW P&L, BALANCE SHEET AND OTHER KEY FIGURES 2023 2022 2021 2020 2019 2018 2017 Results of operations (in EUR million) Gross profit 2,581 2,256 1,721 1,187 1,875 1,823 1,808 Gross margin in % 61.5 61.8 61.8 61.0 65.0 65.2 66.2 EBIT 410 335 228 (236) 344 347 341 EBIT margin i
Slide 105: 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 and similar expressions identify forward-looking statements. Such statements are subject to risks and uncertainties. If any of t

Hugo Boss — Investor Presentation (March 2024) on 6ix

Hugo Boss — Investor Presentation (March 2024)

Slide 1: Investor Meeting Presentation

Slide 2: Agenda

Slide 3: Vision and Mission

Slide 4: Ambition

Slide 5: Claim 5 Strategy

Slide 6: We Have Achieved a Lot

Slide 7: Strong Acceleration in Top-Line Growth Leads to Market Share Gains

Slide 8: Significant Increase in Brand Value

Slide 9: 1st Place in Brand Heat Ranking

Slide 10: 2025 Financial Ambition

Slide 11: Execution of Claim 5 to Impact Financial Ambition

Slide 12: New 2025 Financial Ambition

Slide 13: Top-Line Ambition

Slide 14: Balanced Growth Profile to Continue

Slide 15: Bottom-Line Development

Slide 16: Store Network Optimization

Slide 17: Operating Overhead Costs and Fulfilment

Slide 18: Capital Expenditure

Slide 19: Trade Net Working Capital

Slide 20: Driving Organic Growth to Generate Shareholder Return

Slide 21: Boost Brands

Slide 22: Two Clearly Distinguished Brands

Slide 23: Be Your Own BOSS

Slide 24: HUGO Your Way

Slide 25: Continuous Focus on Brand Building Initiatives

Slide 26: Clearly Distinguished Marketing

Slide 27: Maximize Consumer Impact

Slide 28: Product Is Key

Slide 29: Brand Lines Reflect BOSS Menswear 24/7 Lifestyle Promise

Slide 30: Product Strategy BOSS Menswear

Slide 31: Brand Lines Reflect BOSS Womenswear 24/7 Lifestyle Promise

Slide 32: Product Strategy BOSS Womenswear

Slide 33: HUGO Celebrates 24H Self-Expression

Slide 34: Product Strategy HUGO

Slide 35: Two Brand Lines with Dedicated Styles

Slide 36: Global Licenses Business Extends 24/7 Lifestyle Promise

Slide 37: Lead in Digital

Slide 38: Constantly Developing Digital Capabilities

Slide 39: Shifting Towards Trend Analytics with Data and Generative AI

Slide 40: Foster Digital Product Creation

Slide 41: Launch of a Digital Twin

Slide 42: Digital Innovation in Retail

Slide 43: Leveraging Data to Improve Merchandising Processes

Slide 44: Drive Omnichannel

Slide 45: Omnichannel

Slide 46: Leveraging Our High-Quality Channel Mix

Slide 47: Experiential in Retail

Slide 48: Investing Up to Store Portfolio

Slide 49: Increase Store Productivity

Slide 50: Win with the Winners in Wholesale

Slide 51: Exploit the Full Potential of Global Franchise Business

Slide 52: Inspirational in Digital

Slide 53: Leveraging Potential of hugoboss.com

Slide 54: Keep Growth Trajectory in the Americas

Slide 55: Exploit Growth Momentum in EMEA

Slide 56: Unleash the Full Potential in Asia/Pacific

Slide 57: Organize for Growth

Slide 58: Stepping Up Investments in Our Logistics Network

Slide 59: Izmir Expansion

Slide 60: Advancing with Nearshoring

Slide 61: Sustainable Throughout

Slide 62: Strong Achievements in Sustainability

Slide 63: Five Strategic Sustainability Pillars

Slide 64: Dedicated Goal Behind Each Strategic Pillar

Slide 65: Strategic Pillars Backed by Strong ESG Basis

Slide 66: Full Year 2023 Results

Slide 67: Double-Digit Top- and Bottom-Line Improvements

Slide 68: Strong Brand Momentum Drives Revenues for BOSS and HUGO

Slide 69: Double-Digit Revenue Growth Across All Regions

Slide 70: Record Strong Sales Improvements at All Consumer Touchpoints

Slide 71: Gross Margin Slightly Below Prior-Year Level

Slide 72: Strong Bottom-Line Improvements Despite Ongoing Investments

Slide 73: Normalization in Inventories Successfully Initiated

Slide 74: Step-Up in Capex Weighs on Free Cash Flow

Slide 75: Overproportionate Increase in Dividend Proposal

Slide 76: Outlook 2024

Slide 77: Outlook for Fiscal Year 2024

Slide 78: Sales Outlook

Slide 79: Sales Outlook by Region