Hugo Boss : Semi-Annual Report - H1 2022 Report

FIRST HALF YEAR REPORT JANUARY-JUNE2022

First Half Year Report 2022

Contents

Page 2

CONTENTS

3 Key Figures

1 CONSOLIDATED INTERIM MANAGEMENT REPORT

5 General Economic Situation and Industry

Development

5 General Economic Situation

5 Industry Development

7 Earnings Development

7 Sales Performance

11 Income Statement

12 Sales and Earnings Development

of the Business Segments

15 Net Assets

16 Financial Position

17 Outlook

17 Subsequent Events

17 Outlook

19 Risks and Opportunities

20 Summary on Earnings, Net Assets, and Financial Position

Due to rounding, numbers presented in this First Half Year Report may not add up precisely to the totals provided.

2 CONSOLIDATED INTERIM FINANCIAL STATEMENTS

22 Consolidated Income Statement

23 Consolidated Statement of Comprehensive Income

24 Consolidated Statement of Financial Position

25 Consolidated Statement of Changes in Equity

26 Consolidated Statement of Cash Flows

27 Condensed Notes to the Consolidated Interim Financial Statements

3

FURTHER INFORMATION

50 Responsibility Statement

1. Forward-LookingStatements and Contacts
2. Financial Calendar

First Half Year Report 2022

Key Figures

Page 3

KEY FIGURES

(in EUR million)						Change		Currency-adjusted
		2022			2021		in %		change in %
Sales		1,650			1,126		47		42
Sales by segment
Europe incl. Middle East and Africa		1,054			684		54		53
Americas		334			203		65		49
Asia/Pacific		219			205		7		1
Licenses		42			34		23		23
Sales by distribution channel
Brick-and-mortar retail		891			565		58		52
Brick-and-mortar wholesale		417			274		52		47
Digital		300			252		19		16
Licenses		42			34		23		23
Sales by brand
BOSS Menswear		1,305			886		47		43
BOSS Womenswear		104			77		34		31
HUGO		241			163		48		44
Results of operations
Gross profit		1,033			685		51
Gross margin in %		62.6			60.9		170 bp
EBIT		140			43		> 100
EBIT margin in %		8.5			3.8		460 bp
EBITDA		310			194		60
EBITDA margin in %		18.8			17.3		150 bp
Net income attributable to equity holders
of the parent company		82			14		> 100
Net assets and liability structure as of June 30
Trade net working capital		507			517		(2)		(11)
Trade net working capital in % of sales1		13.8			23.6		(980) bp
Non-current assets		1,472			1,482		(1)
Equity		1,006			792		27
Equity ratio in %		35.3			30.8		450 bp
Total assets		2,847			2,571		11
Financial position
Capital expenditure		61			44		39
Free cash flow		99			103		(4)
Depreciation/amortization		170			151		13
Net financial liabilities (as of June 30)		687			973		(29)
Additional key figures
Employees (as of June 30)2		15,411			13,381		15
Personnel expenses		383			285		34
Shares (in EUR)
Earnings per share		1.18			0.21		>100
Last share price (as of June 30)		50.36			45.88		10
Number of shares (as of June 30)	70,400,000	70,400,000	0

1. Moving average on the basis of the last four quarters.
2. Full-timeequivalent (FTE).

First Half Year Report 2022

CHAPTER 1

CONSOLIDATED

INTERIM

MANAGEMENT

REPORT

First Half Year Report 2022

General Economic Situation and Industry Development

Page 5

GENERAL ECONOMIC SITUATION AND INDUSTRY DEVELOPMENT

General economic situation

Overall, macroeconomic uncertainties have increased further in the course of the first half of the year. While the global recovery from the COVID-19 pandemic continued in most geographies, surging commodity prices on the back of the war in Ukraine, persisting bottlenecks in global supply chains, as well as a slowdown in China amid renewed pandemic-related restrictions weighed on the general economic situation. Elevated global inflation is forcing policy makers around the globe to raise interest rates, aimed at cooling price growth but risking tipping economies into recession. In addition, further disruption in the natural gas supply to Europe could add to recession risks in several key economies and trigger a global energy crisis.

Consequently, the International Monetary Fund (IMF) has cut its forecast for global economic growth again in July, which is now projected to slow from an estimated 6.1% in 2021 to 3.2% in 2022 and 2.9% in 2023. In the eurozone, economic growth is now expected to moderate towards 2.6% in 2022 (2021: 5.4%), while the IMF predicts that Great Britain will achieve 3.2% of growth (2021: 7.4%). For the U.S., the IMF anticipates growth to slow down to 2.3% in 2022 (2021: 5.7%), reflecting the

-related restrictions in China, the IMF has also cut its forecast for the Chinese economy, now predicting growth to come in at 3.3% in 2022, and thus well below the prior-year level (2021: 8.1%).

Industry development

In the first half of 2022, the global apparel industry continued its recovery from the COVID-19 pandemic, which had already been visible throughout most of 2021, although development varied across regions. Challenges included, in particular, the persistence of pandemic-related production delays, shortages in logistics, a further increase in material and freight costs, and the ongoing shortage of materials. This led to a sharp increase in input costs for many industries, leading companies to increase prices for consumers in times where consumer confidence across key markets is decreasing as overall inflation surges.

Industry growth in the first six months of 2022 was primarily driven by local demand, despite ongoing pandemic-related uncertainties in the wake of the long-lasting Omicron wave. In contrast, business with international tourists is recovering comparatively slowly, partly due to some persisting restrictions on international travel. Given long-lastingpandemic-related lockdowns in China through-

out much of the first half of the year, the Chinese consumer	which is particularly relevant for the
premium and luxury segment of the global apparel market	has reduced spending in the first six