INVESTOR MEETING PRESENTATION - May - August 2021 - HUGO BOSS Group
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1 INVESTOR MEETING PRESENTATION
INVESTOR MEETING
PRESENTATION
May – August 2021
2 INVESTOR MEETING PRESENTATION
Company Overview
SUSTAINABILITY
KEY PRIORITIES
THE COMPANY
One of the leading companies in Create Sustainability
the premium apparel segment brand heat & product desire as integral part of operations
Two iconic brands Exploit Clearly defined
BOSS & HUGO global sales opportunities goals & KPI‘s
Group sales of Drive Top ranked
EUR 2 billion in 2020 operational excellence in DJSI World / Europe
3 INVESTOR MEETING PRESENTATION
AGENDA
1 About HUGO BOSS
2 Q1/2021 Results
3 Strategic Priorities
4 Sustainability
4 INVESTOR MEETING PRESENTATION
HUGO BOSS
A GLOBAL FASHION & LIFESTYLE COMPANY
5 INVESTOR MEETING PRESENTATION
OUR BRANDS
6 INVESTOR MEETING PRESENTATION
BOSS DRESSES THE DRIVE BRAND VALUES
Status-oriented customer in the upper MASCULINITY/FEMININITY
premium segment who wants to dress in a
modern, sophisticated way.
From classic business outfits to a wide range
SEXINESS
SUCCESS
85%
of modern and stylish leisure looks. STYLE of Group sales
PRECISION
7 INVESTOR MEETING PRESENTATION
HUGO IS THE PLATFORM OF BRAND VALUES
SELF-EXPRESSION
Expressive customer in the premium segment.
Casual- and businesswear collections in the
contemporary fashion segment characterized
GLOBALLY ENGAGED
ALWAYS CURIOUS
15%
by progressive designs. of Group sales
AUTHENTICALLY EXPRESSIVE
8 INVESTOR MEETING PRESENTATION
Global sales distribution across 127 countries
SHARE OF GROUP SALES *
EUROPE AMERICAS ASIA/PACIFIC
(INCL. MIDDLE EAST/AFRICA)
63% 16% 18%
GERMANY: 14% U.S.: 11% CHINA: 11%
GREAT BRITAIN: 13% CANADA: 2% OCEANIA: 2%
FRANCE: 6% CENTRAL & SOUTH JAPAN: 2%
AMERICA: 3%
BENELUX: 5% OTHER: 3%
OTHER: 25%
* AS OF 2020; 3% LICENSES
9 INVESTOR MEETING PRESENTATION
Distribution via own retail and wholesale channel
3% LICENSES 11% ONLINE RETAIL
66% RETAIL
31% WHOLESALE
55% B&M RETAIL
FY2020
Own online sales account for 11% of
Group sales in 2020, up from 5% in 2019
10 INVESTOR MEETING PRESENTATION
Well diversified store portfolio
across regions*
Freestanding stores 212
Shop-in-Shops 302
Outlets 75
Europe
589
Freestanding stores 92
Americas Shop-in-Shops 105
251 Asia/Pacific Outlets 54
317
Freestanding stores 141
Group
1,157 Shop-in-Shops 105
Outlets 71
GROUP
445 512 200
Freestanding stores Shop-in-Shops Outlets
*AS OF 30/12/202011 INVESTOR MEETING PRESENTATION
Sourcing and production
focused on Europe and Asia*
44% ASIA
6% NORTH AFRICA
12% WESTERN EUROPE
36% EASTERN EUROPE
01% AMERICAS
17% OWN PRODUCTION
83% THIRD PARTY PRODUCTION
* NUMBERS AS OF 2020, IN VALUE TERMS12 INVESTOR MEETING PRESENTATION
AGENDA
1 About HUGO BOSS
2 Q1/2021 Results
3 Strategic Priorities
4 Sustainability13 INVESTOR MEETING PRESENTATION
On average ~25% of global store network closed
in the first quarter
100%
75%
50%
STORE OPENING RATE *
25%
Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021
0%
~85% ~50% ~95% ~85% ~75%
* NUMBER OF OWN RETAIL POINTS OF SALE NOT AFFECTED BY TEMPORARY
CLOSINGS DIVIDED BY TOTAL NUMBER OF OWN RETAIL POINTS OF SALE14 INVESTOR MEETING PRESENTATION
Solid start to the year as
business recovery continues
Q1 2021
EUR
497 MILLION
(8)%
CURRENCY-ADJUSTED15 INVESTOR MEETING PRESENTATION
EUROPE SALES
**
(17)% *
Almost 50% of own retail stores temporarily closed
in the first quarter
Germany and the UK record mid-double-digit sales
declines in own retail, reflecting persistent lockdowns
Strong momentum in Russia and Middle East with
low to mid-double-digit sales growth
Extended lockdowns weigh on
business recovery in Europe
* CURRENCY-ADJUSTED
** INCL. MIDDLE EAST AND AFRICA16 INVESTOR MEETING PRESENTATION
AMERICAS SALES
(11)% *
Business in the U.S. with noticeable recovery
reflecting a robust rebound in consumer sentiment
Persistent store closures continue to weigh on
business in Canada
Latin America returns to pre-COVID-19 levels
in the first quarter
Sequential
Recovery inimprovements
the Americasincontinues
the U.S.as
drive recovery
momentum in the
in the U.S.Americas
further improves
* CURRENCY-ADJUSTED17 INVESTOR MEETING PRESENTATION
ASIA/PACIFIC SALES
+39% *
Sales in mainland China almost double supported
by robust local demand in Q1
While business in Japan continues its gradual recovery,
Australia and South Korea return to growth in Q1
Absence of international tourism continues to weigh on
Hong Kong and Singapore
Asia/Pacific returns to growth driven by
ongoing strong momentum in mainland China
* CURRENCY-ADJUSTED18 INVESTOR MEETING PRESENTATION
Q1 2021
+72%
CURRENCY-ADJUSTED
Momentum in online business
strongly accelerates in the first quarter19 INVESTOR MEETING PRESENTATION
Wholesale business benefits from
robust order intake and delivery shift effects
OWN
RETAIL
(14)% *
WHOLESALE
+1% *
* CURRENCY-ADJUSTED20 INVESTOR MEETING PRESENTATION
(8)% (6)%
BOSS
HUGO
Casualwear returns to
mid-single-digit growth in Q1
*TOTAL BRAND SALES; CURRENCY-ADJUSTED21 INVESTOR MEETING PRESENTATION
HUGO BOSS records
positive EBIT in the first quarter
Gross margin Selling & distribution Administration EBIT Net income
expenses expenses
EUR EUR EUR EUR
60.4 231 68 1 (8)
% MILLION MILLION MILLION MILLION
62.9% EUR 288 MILLION EUR 75 MILLION EUR (14) MILLION EUR (18) MILLION
Q1 2020 Q1 2020 Q1 2020 Q1 2020 Q1 202022 INVESTOR MEETING PRESENTATION
Trade net working capital improvement supports
free cash flow development
TNWC Capital expenditure Free cash flow
March 31, 2021 January - March January - March
Inventories remain stable reflecting
EUR EUR EUR
ongoing tight management
550 16 (30) Lower capital expenditure reflecting
MILLION MILLION MILLION continued prudent approach in light of
persistent uncertainties
Net financial liabilities decline 5%
to EUR 221 million*
EUR 592 MILLION EUR 18 MILLION EUR (86) MILLION
March 31, 2020 Jan - March 2020 Jan - March 2020
*Excluding IFRS 1623 INVESTOR MEETING PRESENTATION
Outlook
GLOBAL BUSINESS EXPECTED
TO RECOVER NOTICEABLY
IN 202124 INVESTOR MEETING PRESENTATION
AGENDA
1 About HUGO BOSS
2 Q1/2021 Results
3 Strategic Priorities
4 Sustainability25 INVESTOR MEETING PRESENTATION
VISION BE THE MOST DESIRABLE PREMIUM
FASHION & LIFESTYLE BRAND26 INVESTOR MEETING PRESENTATION
Our strategic priorities
for future growth
CREATE EXPLOIT DRIVE
BRAND HEAT & GLOBAL SALES OPERATIONAL
PRODUCT DESIRE OPPORTUNITIES EXCELLENCE27 INVESTOR MEETING PRESENTATION
EMOTIONALIZE
THE BRANDS
Emotionalize the brands and
deliver inspiring storytelling
DOMINATE
CLOTHING
Leverage strengths in clothing segment
to increase market share
CREATE
PUSH
BRAND HEAT & CASUALIZATION
Leverage trend towards casualization and
PRODUCT DESIRE exploit opportunities28 INVESTOR MEETING PRESENTATION
Marketing initiatives to
drive brand desirability
EVENTS PERSONALITIES COLLABORATIONS29 INVESTOR MEETING PRESENTATION
Community engagement
on social media further accelerates
AVERAGE NUMBER OF INSTAGRAM
LIKES PER POST FOLLOWERS
MORE THAN GROW
2x
double double-dgi
double-digit
2020 VS. 2019 2020 VS. 201930 INVESTOR MEETING PRESENTATION Serving our customers across all wearing occasions
31 INVESTOR MEETING PRESENTATION
New interpretation of formalwear with
strong focus on casual tailoring
BROAD
BOMBER
SUIT
CASUAL
TAILORING32 INVESTOR MEETING PRESENTATION Chris Hemsworth is the global face of BOSS
33 INVESTOR MEETING PRESENTATION
BOSS x AJBXNG
gains further momentum
FATHER‘S DAY
CAMPAIGN34 INVESTOR MEETING PRESENTATION
Successful launch of exclusive
BOSS x NBA capsule35 INVESTOR MEETING PRESENTATION
Successful launch of
BOSS x RUSSELL ATHLETIC36 INVESTOR MEETING PRESENTATION
HUGO x Liam Payne
supports “Cotton made in Africa”37 INVESTOR MEETING PRESENTATION
LEVERAGE
ONLINE & OC EXPERIENCE
#onlinefirst: Aggressively invest in online
growth and omnichannel services
EXPLOIT
EXPLOIT GROWTH POTENTIAL IN CHINA
China first: Elevate product offering, increase
GLOBAL SALES brand hype, push retail productivity, increase
space and grow online
OPPORTUNITIES38 INVESTOR MEETING PRESENTATION
Exploiting the full potential
of mainland China
Momentum continues into 2021, supported by
strong activation around Chinese New Year
Local brand ambassadors drive awareness
among younger customers
Leveraging full potential through moderate space
expansion and strong focus on online
GROUP SALES CAGR CONTROLLED “TAILORED”
2016-2020 DISTRIBUTION SHARE
10% +8% >95%* >30%*
BASED on FY SALES ML CHINA OWN RETAIL OF
2020 SHARE PRODUCT MIX
* AS OF 202039 INVESTOR MEETING 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 2 and tier 3 cities
2 to support momentum
Upsizing opportunities Implementation of WeChat Work
3 in prime locations 3 to exploit social commerce40 INVESTOR MEETING 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 300 million mark to be crossed
before year-end 2021
221
151
110 CAGR of >40% achieved
76 79 between 2018 and 2020
2016 2017 2018 2019 2020 2022e41 INVESTOR MEETING PRESENTATION
Geographical rollout of
hugoboss.com in full swing
hugoboss.com hugoboss.com
markets 2020 markets 2021
At the end of Q1 2021, hugoboss.com is
available in 59 markets42 INVESTOR MEETING PRESENTATION
LEVERAGE
SCALE AT OPERATIONS
Implement a lean & flexible supply chain
Drive digitalization across all Operations
activities
Continue simplification journey
DRIVE
Realize COGS savings through sourcing
optimization without compromising quality
OPERATIONAL
EXCELLENCE43 INVESTOR MEETING PRESENTATION
AGENDA
1 About HUGO BOSS
2 Q1/2021 Results
3 Strategic Priorities
4 Sustainability44 INVESTOR MEETING PRESENTATION
RESPONSIBILITY
The aim of the Company’s sustainability
activities is to ensure its long-term success
through continuous improvement and
anticipatory management of environmental,
social as well as economic opportunities and
SUSTAINABILITY risks.
is an integral part of
business operations
at HUGO BOSS45 INVESTOR MEETING PRESENTATION
Clearly defined KPI’s
to measure progress in sustainability
ORGANIZATIONAL PROCESSES KPIS AND
STRUCTURE AND TOOLS INCENTIVES
▪ Global sustainability ▪ Clear guidelines, policies and ▪ Clearly defined KPIs to measure
department steering the topic tools to ensure sustainable improvement in sustainability
business practices
▪ Responsible managers for ▪ Sustainability criteria as part of
sustainability in different ▪ Established data collection, and the long-term performance
departments reporting processes related compensation of the
Managing Board
▪ Continuous meetings with the ▪ Data management tools to
Management Board to discuss track progress on targets ▪ Progress awarded by DJSI
targets and progress World and DJSI Europe inclusion46 INVESTOR MEETING PRESENTATION
Sustainability commitment ingrained in the concept
TODAY. TOMORROW. ALWAYS.
TOMORROW ALWAYS
TODAY
Tomorrow contains the Always encompasses our
Today stands for the
concrete goals we have set overall sustainability
milestones achieved so far
ourselves for the future principles47 INVESTOR MEETING PRESENTATION
TODAY. TOMORROW. ALWAYS.
embedded in our three focus areas
PRODUCT PEOPLE & SOCIETY ENVIRONMENT
In addition to design, Adherence to high social We are committed to the
quality, and durability, our standards forms the basis introduction and further
products meet high for our relationships. development of more
standards with regards to A commitment to social environmentally and
health, environmental, and welfare is an integral part of climate-friendly processes.
animal welfare. our corporate responsibility.48 INVESTOR MEETING PRESENTATION
Product
Strive for highest quality and longevity
ALWAYS. Our ongoing commitment to serve
conscious customer segment:
Offering more sustainable products through the use
of more sustainable materials while at the same
time respecting animal welfare and ensuring
product safety.
TODAY.
RESPONSIBLE styles* outperform in the collection
with a higher sell-through
PRODUCT
*All products that contain at least 60% more sustainable raw materials will show the RESPONSIBLE label.
RESPONSIBLE Styles also meet other environmental and social criteria regarding processing, transport and packaging.49 INVESTOR MEETING PRESENTATION
Product
TODAY. Increasing responsible product offering
2018
2019
2020
2021
PF18 FW19 PS20 SR20 FW20 SR21 PF21 FW21
RESPONSIBLE TAILORING RESPONSIBLE: Today. Tomorrow. Always.
PRODUCT BOSS:
THE JOURNEY
HUGO:
Piñatex® sneaker CLEAN UP
BOSS Menswear YOUR ACT
Traceable Wool Circular Design Continuation of BOSS: BOSS:
Capsule Collection Capsule Traceable Wool THE JOURNEY THE JOURNEY
BOSS Men´s Business BOSS Menswear Capsule NATURAL FIBERS
BOSS Mens- & cotton, linen,
Continuation of Womenswear Vegan Suit HUGO: hemp, wool HUGO:
Piñatex® sneaker BOSS Men´s CLEAN UP CLEAN UP YOUR ACT
BOSS Mens- & Business YOUR ACT Liam Payne & CmiA
Womenswear Kapok Capsule Collection Capsule
Olivenleder® Capsule Collection
BOSS & HUGO BOSS Men´s Casualwear50 INVESTOR MEETING PRESENTATION
Product
TOMORROW. Our main goals by 2025
SDGs MAIN GOAL STATUS 2020
(Sustainable Development Goals
of the United Nations)
100% sustainably sourced cotton 86%
≥ 50% recycled synthetic fibers 10%
≥ 30% of offered styles are RESPONSIBLE* 15%
100% of plastic packaging out of 42%
recycled or sustainable sources
*ALL PRODUCTS THAT CONTAIN AT LEAST 60% MORE SUSTAINABLE RAW MATERIALS WILL SHOW THE RESPONSIBLE LABEL.
RESPONSIBLE STYLES ALSO MEET FURTHER ENVIRONMENTAL AND SOCIAL CRITERIA REGARDING PROCESSING, TRANSPORT, AND PACKAGING.51 INVESTOR MEETING PRESENTATION
People & Society
Taking responsibility for the people we work with
ALWAYS. Our ongoing commitment to motivate
employees and take responsibility along the supply
chain:
Assuming responsibility for employees and
suppliers to ensure safe and healthy jobs.
Developing together in long-term, trusting
partnerships to ensure social compliance and
reduce risks.
TODAY.
Started with the “Living wages” initiative as part of the
Partnership for Sustainable Textiles with the aim to achieve
collective solutions for living wages in countries of
PEOPLE & SOCIETY production52 INVESTOR MEETING PRESENTATION
People & Society
TOMORROW. Our main goals by 2025
SDGs MAIN GOAL STATUS 2020
(Sustainable Development Goals
of the United Nations)
75 % employee satisfaction according to the Great
Place to Work® survey
72%
Share of at least 40% of women in the first and 50% of
women in the second management level below the
25%
Managing Board 45%
All goods sourced from suppliers with satisfying or
better performance in social audits 96%
All directly contracted fabrics and trimmings suppliers 10%
are integrated in social compliance program53 INVESTOR MEETING PRESENTATION
Environment
Reducing our environmental impact
ALWAYS. Our ongoing commitment to reduce our
environmental impact while saving costs:
We continuously minimize our impacts on climate
change, reduce the consumption of resources and
use chemicals responsibly.
TODAY.
In 2020, more than half of the electricity consumed within
the Group came from renewable energy sources.
ENVIRONMENT54 INVESTOR MEETING PRESENTATION
Environment:
TOMORROW. Our main goals
SDGs MAIN GOAL STATUS 2020
(Sustainable Development Goals
of the United Nations)
Climate neutrality in the whole value chain until 2050
Reduction of CO2 emissions (Scope 1+2) by at least 51%
Scope 1+2: Reduction of 36%
Reduction of CO2 emissions (Scope 3) by 30%
Scope 3: Reduction of 28%
Reduction of energy consumption (direct & indirect) in relation to area (m²) by 20%
Energy reduction of 22%
(base year 2018) until 2030
Reduction of own water consumption (externally sourced
water) in relation to Group sales by 40% compared with 5%
the base year 2016 until 2025
100% of suppliers with high environmental impact comply 20%
with the HUGO BOSS environmental requirements until 202555 INVESTOR MEETING PRESENTATION
DJSI World
FTSE4Good
DJSI Europe
Index member since
Index member since 2016 2017 (World) & 2020 (Europe)
STOXX Global
Euronext Vigeo
ESG Leaders
Europe 120
DAX 50 ESG
Eurozone 120
Leaders
Index member since 2020 Index member since 2019
HUGO BOSS sustainability achievements
recognized in many sustainability indices56 INVESTOR MEETING PRESENTATION
Financial Calendar &
Investor Relations contact
Christian
AUGUST
Stöhr
4 Second Quarter Results
Vice President
Investor Relations E-Mail: Christian_Stoehr@hugoboss.com
2021 und Corporate
2021 Communications Phone: +49 (0) 7123 94 - 80903
NOVEMBER
Frank Böhme
4 Third Quarter Results
Senior Investor
Relations Manager
E-Mail: Frank_Boehme@hugoboss.com
2021 Phone: +49 (0) 7123 94 - 80903
202157 INVESTOR MEETING PRESENTATION Forward-looking statements contain risks This document contains forward-looking statements that reflect management's current views with respect to future events. The words “anticipate”, “assume”, “believe”, “estimate”, “expect”, “intend”, “may”, “plan”, “project”, “should”, and similar expressions identify forward-looking statements. Such statements are subject to risks and uncertainties. If any of these or other risks and uncertainties occur, or if the assumptions underlying any of these statements prove incorrect, then actual results may be materially different from those expressed or implied by such statements. We do not intend or assume any obligation to update any forward-looking statement, which speaks only as of the date on which it is made.
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