© Reuters. An employee displays suits at the Hugo Boss section of the Central Universal Department Store (TsUM), on the first day after ending a coronavirus lockdown, in Kyiv, Ukraine January 25, 2021. REUTERS/Valentyn Ogirenko/File photo
(Reuters) -Hugo Boss on Thursday forecast operating profit for 2024 below market expectations, as it flagged persistently weak consumer confidence, in particular in distinct European economies.
The German fashion house estimates earnings before interest and taxes (EBIT) of 430 million to 475 million euros, below analysts’ estimate of 490 million euros ($534.1 million) in a company-provided poll.
Hugo Boss continued reaping the fruits of its 2022 brand revamp last year, which brought in new customers in Asia and helped it maintain sales momentum despite weakening demand in Europe.
However, unfavourable currency effects coupled with an increasingly promotional market dampened margin improvement at the end of 2023, the company said.
The luxury and apparel sector had to discount products in the last months the year, as companies aimed to cut down their inventories amid slowing demand.
Hugo Boss forecast sales growth of between 3% and 6% in 2024 to around 4.30 billion to 4.45 billion euros, also below an estimate of 4.56 billion euros in a company-provided poll, and a marked slowdown compared to a 18% rise in sales in 2023.
The company confirmed its preliminary figure for an operating profit of 410 million euros in 2023.
($1 = 0.9174 euros)
