BERLIN, Dec 3 (Reuters): Hugo Boss shares dropped 11 per cent on Wednesday after it warned that its sales and profit would fall next year, as the struggling German fashion brand embarks on a strategic reset.
Days after its top shareholder Frasers withdrew support for its chairman, Hugo Boss slashed its operating profit forecast and said it expects currency-adjusted sales to decline by a mid- to high-single digit percentage in 2026.
The retailer of men's suits and casualwear is refining its product range and streamlining operations in response to falling sales in its Europe, Middle East and Africa region as well as in Asia Pacific, which it blamed on weakness in the UK and China.
"To ensure sustainable, profitable growth, we now have to refocus, simplify, and strengthen our business to prepare Hugo Boss for the next level," CEO Daniel Grieder told reporters.
Trade barriers and cautious consumers were hurting business, Grieder added on the media call.
Britain's Frasers, which has a 25 per cent stake in Hugo Boss, is pushing for board-level change. Last week it said it no longer supports the company's chairman Stephan Sturm, who Hugo Boss said is firmly committed to continuing in the role.
Hugo Boss' new strategy launched on Wednesday aims to strengthen the brand by improving stores, focusing on high-growth categories like shoes and accessories, and developing its womenswear range.
"Without a question, womenswear is the biggest single potential that Hugo Boss has from a business unit perspective to drive growth and profitability," its chief sales officer Oliver Timm said on the media call.
Hugo Boss expects earnings before interest and tax (EBIT) of between 300 million euros and 350 million euros ($408 million) in 2026.
