Hugo Boss Ag · XETR:BOSS
Hugo Boss — Q3 2020 Earnings Presentation
28 slides from Hugo Boss's earnings presentation, Nov 3, 2020
Slide 1: Third Quarter 2020 Results Presentation
THIRD QUARTER 2020 RESULTS PRESENTATION NOVEMBER 3, 2020
Slide 2: Yves Müller, Spokesperson of the Managing Board
YVES MÜLLER SPOKESPERSON OF THE MANAGING BOARD
Slide 3: Gradual business recovery continues in the third quarter
3 Q3 2020 RESULTS PRESENTATION GROUP SALES Q3 2020 EUR 533 MILLION (24)% CURRENCY-ADJUSTED Gradual business recovery continues in the third quarter
Slide 4: Own retail business benefits from higher store opening rate
4 Q3 2020 RESULTS PRESENTATION RETAIL (20)%* Robust recovery in own retail, supported by average store opening rate of ~95% in Q3 Local demand improves in key markets while travel restrictions continue to weigh on business with tourists Wholesale business impacted by lower deliveries to partners (30
Slide 5: Online business continues its double-digit growth trajectory
5 Q3 2020 RESULTS PRESENTATION hugoboss.com and concession business record strong improvements in both traffic and conversion rates Further expansion of hugoboss.com to 24 additional countries in June and August 12th consecutive quarter with strong double-digit online sales growth Online business co
Slide 6: Momentum in mainland China further accelerates in Q3
6 Q3 2020 RESULTS PRESENTATION Recovery in mainland China continues, with revenues up 27% in Q3 Strong improvements in conversion rates in brick-and-mortar retail High double-digit online sales growth recorded in the third quarter Momentum in mainland China further accelerates in Q3 * CURRENCY-ADJUS
Slide 7: Asia/Pacific with strong business recovery in Q3
7 Q3 2020 RESULTS PRESENTATION ASIA/PACIFIC SALES Strong momentum in mainland China drives overall recovery in Asia/Pacific (14)% * Lower tourist flows continue to negatively impact business in Hong Kong and Macao Local lockdowns and temporary store closures weigh on several markets such as Australi
Slide 8: Europe records solid rebound in local demand
8 Q3 2020 RESULTS PRESENTATION EUROPE SALES ** Solid rebound in local demand, in particular in France, Benelux and the UK (21)% * Sales recovery in Germany broadly in line with that of the region Southern European markets negatively impacted by lower tourist flows Europe records solid rebound in loc
Slide 9: Pandemic continues to weigh on business in the Americas
9 Q3 2020 RESULTS PRESENTATION AMERICAS SALES Robust business recovery continues in Latin America (41)% * Temporary store closures due to local lockdowns in several key areas weighs on business recovery in the U.S. U.S. business also impacted by ongoing traffic declines in brick-and-mortar retail an
Slide 10: BOSS and HUGO with similar trends in Q3
10 Q3 2020 RESULTS PRESENTATION (24)% * (25)% * BOSS and HUGO with similar trends in Q3 * CURRENCY-ADJUSTED
Slide 11: Profitability returns to positive territory in the third quarter
11 Q3 2020 RESULTS PRESENTATION Profitability returns to positive territory in the third quarter Gross margin Selling & distribution Administration EBIT Net income expenses expenses EUR EUR EUR EUR 61.9 251 65 15 3 % MILLION MILLION MILLION MILLION (140) bp (18)% (4)% (83)% (94)% YOY YOY YOY YOY YOY
Slide 12: Inventories remain broadly stable year over year
12 Q3 2020 RESULTS PRESENTATION Inventories TNWC Free cash Capital flow expenditure September 30, 2020 September 30, 2020 April-June July–September Inventory growth curbed, reflecting gradual business recovery and measures to reduce inventory inflow EUR EUR EUR Decrease in trade net working capital
Slide 13: Strong free cash flow generation accelerates in the third quarter
13 Q3 2020 RESULTS PRESENTATION Strong free cash flow generation accelerates in the third quarter Revolving syndicated loan, totaling JAN–SEP Q3 EUR 633 million, only utilized in the amount of EUR 134 million as of September 30 Additional credit commitments of EUR 275 million not drawn at the end of
Slide 14: Key priorities while managing the pandemic
14 Q3 2020 RESULTS PRESENTATION Key priorities while managing the pandemic MAR APR MAY JUN JUL AUG SEP OCT NOV 2020 2020 2020 2020 2020 2020 2020 2020 2020 MANAGING THE PANDEMIC Gradual recovery of business Measures to maintain financial stability and flexibility Execution of strategic initiatives
Slide 15: Exploiting the full potential of mainland China
15 Q3 2020 RESULTS PRESENTATION GROUP SALES CAGR 2016-2019 7% +10 % BASED on FY 2019 SALES ML CHINA CONTROLLED “TAILORED” DISTRIBUTION SHARE >95 % >30 % OWN RETAIL OF Exploiting the full potential SHARE PRODUCT MIX of mainland China
Slide 16: Local activation drives customer engagement
16 Q3 2020 RESULTS PRESENTATION Local activation drives customer engagement CHINESE GOLDEN WEEK OCTOBER 1–8, 2020 QIXI CHINESE VALENTINE'S DAY AUGUST 25, 2020
Slide 17: Leveraging sales opportunities in mainland China
17 Q3 2020 RESULTS PRESENTATION Leveraging sales opportunities in mainland China Robust retail footprint Concession business on Tmall and JD 1 across tier 1 and tier 2 cities 1 with strong double-digit growth White spot opportunities, Tapping in to additional e-com opportunities 2 especially in tier
Slide 18: Well on track to achieve 2022 online sales target
18 Q3 2020 RESULTS PRESENTATION Well on track to achieve 2022 online sales target Online sales to grow to more than EUR 400 million by 2022 Online sales x4 (in EUR million) >400 EUR 200 million mark to be crossed well before year-end 2020 >200 151 110 CAGR of >40% achieved 76 79 between 2018 and 202
Slide 19: Geographical rollout of hugoboss.com in full swing
19 Q3 2020 RESULTS PRESENTATION Geographical rollout of hugoboss.com in full swing hugoboss.com markets 2019
Slide 20: Geographical rollout of hugoboss.com in full swing
20 Q3 2020 RESULTS PRESENTATION Geographical rollout of hugoboss.com in full swing hugoboss.com markets 2020
Slide 21: Geographical rollout of hugoboss.com in full swing
21 Q3 2020 RESULTS PRESENTATION Geographical rollout of hugoboss.com in full swing hugoboss.com markets 2021
Slide 22: Marketing initiatives to drive brand desirability
22 Q3 2020 RESULTS PRESENTATION Marketing initiatives to drive brand desirability EVENTS PERSONALITIES COLLABORATIONS
Slide 23: Milan Fashion Show goes Shanghai with local brand experience
23 Q3 2020 RESULTS PRESENTATION Milan Fashion Show goes Shanghai with local brand experience
Slide 24: Brand ambassadors drive brand heat for BOSS and HUGO
24 Q3 2020 RESULTS PRESENTATION 2.6 M 11.5 M 21.4 M FOLLOWERS FOLLOWERS FOLLOWERS BOSS X BOSS HUGO X CARO DAUR X AJBXNG LIAM PAYNE Brand ambassadors drive brand heat for BOSS and HUGO
Slide 25: Strong uplift in engagement on social media
25 Q3 2020 RESULTS PRESENTATION Strong uplift in engagement on social media AVERAGE NUMBER OF AVERAGE LIKES PER POST ENGAGEMENT RATE INCREASED BY 4x >60% Q3 2020 VS. Q3 2019 Q3 2020 VS. Q3 2019
Slide 26: BOSS teams up with Russell Athletic
26 Q3 2020 RESULTS PRESENTATION BOSS teams up with Russell Athletic CAPSULE COLLECTION BOSS X WITH FOCUS ON BOLD RUSSELL ATHLETIC CASUALWEAR LAUNCH ACCOMPANIED BY AN EXCLUSIVE CAMPAIGN PRODUCED BY HIGHSNOBIETY BOSS X RUSSELL ATHLETIC
Slide 27: Driving casualization across all wearing occasions
27 Q3 2020 RESULTS PRESENTATION Driving casualization across all wearing occasions
Slide 28: Q&A
28 Q3 2020 RESULTS PRESENTATION Q&A