// Hugo Boss reports 22% fall in operating profit to £47.1m
// Currency-adjusted sales increased by 1% to £569m
// Hugo Boss expects sales to increase at a mid-single-digit percentage rate for 2019
Hugo Boss has reported a 22 per cent fall in operating profit to €55 million (£47.1 million) in the first quarter of 2019.
The luxury fashion retailer said the profit drop was a result of large investments in the digital transformation of its business model.
It also reported in its financial report that the “appreciation of the US dollar against the euro had a negative impact on earnings”.
Meanwhile, currency-adjusted sales increased by one per cent to €664 million (£569 million).
Despite an earnings decline, Hugo Boss said it expected currency-adjusted sales to increase at a mid-single-digit percentage rate this year.
The company also expects its partnerships with online retailers in the concession model and the renovation of its stores to “significantly drive growth” throughout the year.
“The ongoing momentum in our strategic growth market China and in the important online business shows that our strategy is taking effect,” Hugo Boss chief executive Mark Langer said.
“At the same time, the US market proved to be weaker than expected.
“Moreover, investments in the digitisation of our business model and in the organisational structure weighed on our operating result in the first quarter.
“However, they will help us to further accelerate important operational processes and to significantly improve our cost efficiency in the current year.
“I am very confident that we will achieve our targets for the full year and beyond.”
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