BOSS PROFITS UP 93%
METZINGEN, Germany — Hugo Boss had a very, very good millennium year.
The German apparel giant reported here Monday that, for the fifth year in a row, Hugo Boss racked up double-digit sales gains, and for the tenth consecutive year it broke earnings records. Profits after taxes surged 93 percent to $100.9 million (DM 213 million). All dollar figures are calculated from the German mark at current exchange.
Outpacing the company’s upwardly revised projections released last November, group sales in 2000 rose 23 percent to $856 million (DM 1.803 million).
Sales from the new Boss Woman collection that launched this spring were not reflected in group sales figures for the first three quarters of 2000, and only minimally affected the company’s total for the year, a spokesman said.
Boss attributed the stellar sales and profit performance to “the attractiveness of the brand…” as well as the rollout of Hugo Boss shops worldwide and marked sales growth in the North American and core European markets.
There are currently 360 Hugo Boss stores around the world, including 31 in the U.S.
The women’s line went wide in its initial distribution, and is being carried in Saks Fifth Avenue, Barneys New York, Bloomingdale’s and Macy’s.
As reported, the company is also expanding its retail presence in the U.S. Last summer, Hugo Boss signed a lease to open a 23,000-square-foot store in the former Steuben glass space on the southeast corner of 56th Street and Fifth Avenue. The store is currently under construction and is expected to open this April. Hugo Boss has also signed a retail lease for a 14,300-square-foot space at The Palladium at AOL Time Warner Center, the 2.1 million-square-foot retail and entertainment project being built on the site of the New York Coliseum at Columbus Circle. That store will carry women’s and men’s apparel and accessories under the Boss and Hugo labels.
Both New York retail ventures are expected to further the brand’s visibility, and with it, inevitably, pump up the company’s volume.
A spokesman at the headquarters said Monday that the bounding profits benefited from three other factors.
“First of all, fourth-quarter sales were very strong,” he said. “In addition, there was a positive tax situation and gross margins improved.” In a continuation of last year’s profit-oriented dividend policy, the board of directors has recommended a dividend increase of three euros per share. That would bring the dividend for common shares to seven euro and preferred shares to $7.70 (7.07 euro), compared to four and $4.43 (4.07 euro) respectively in 1999. Preferred shares, which are traded on the MDax in Frankfurt, closed Monday at $381.50 (350 euro), up 10.54 percent.