Hugo Boss AG (BOS) may raise its 2015 profitability goal as soon as this month as the German luxury clothier expands its own-brand chain and in Asia, analysts including Bankhaus Lampe’s Christoph Schlienkamp said.
Hugo Boss may set a target of earnings before interest, taxes, depreciation, amortization and one-time items at 22 percent of sales from the current 20 percent aim, Schlienkamp said. The clothier will probably revise the outlook when it reports half-year figures on July 28, he said.
China, where demand for expensive men’s wear is rising, will probably become Metzingen-based Hugo Boss’s third-largest market this year, overtaking France and the U.K. while still lagging behind Germany and the U.S., Chief Financial Officer Mark Langer said last month. The clothier has said the Hugo Boss-branded stores are likely to raise their portion of group sales to almost 50 percent by 2015 from 40 percent in 2010.
“Hugo Boss is successfully building up its own-store and Asia activities, which are both more profitable than other businesses,” Schlienkamp said in an interview at his office in Dusseldorf, Germany.
The clothier’s Ebitda margin last year was 19.4 percent of sales, with the figure reaching 20.2 percent excluding one-time gains or costs. Hugo Boss is likely to report an unadjusted margin of 22.4 percent as early as 2014, said Herbert Sturm, an analyst at DZ Bank in Frankfurt who thinks the 2015 target will be raised. The figure on that basis could total 22.6 percent by 2013, Rogerio Fujimori a London-based Credit Suisse AG analyst, said in a research report.
Hjoerdis Kettenbach, a Hugo Boss spokeswoman, declined to comment on the analysts’ estimates.
Schlienkamp has a “hold” rating on Hugo Boss stock, while Sturm recommends investors buy the shares and Fujimori has an “outperform” recommendation.
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