Hugo Boss Group's sales increased by 9% to EUR 2,809 million in 2015 (2014: EUR 2,572 million).
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Adjusted for currency effects, the increase came to 3% and was therefore in line with the forecast made in October last year. A currency-adjusted sales increase of 5% in the fourth quarter supported this performance, which was mainly sustained by Europe with a robust sales increase of 6% for the full year.
Growth in Europe accelerated to 10% in the fourth quarter with both the group's own retail business and the wholesale business contributing to this development.
In contrast, currency-adjusted sales in the Americas and Asia/Pacific declined slightly by 1% and 3% respectively over the year as a whole.
In the Americas, fourth-quarter sales also dipped 1% below the prior year's level in local currencies, mainly because sales trends in the U.S. market did not improve as compared to third quarter. Double-digit sales decreases in China led to a currency-adjusted decline of 7% in Asia/Pacific in the fourth quarter.
Sales in the group's own retail business were 7% above the prior year's level in local currencies in 2015. The online business made an important contribution with double-digit growth.
Currency-adjusted retail comp sales increased by 2%. In the fourth quarter, the group's own retail business grew by 6% adjusted for currency effects, showing similar growth to the full year. However, retail comp sales for the period decreased slightly by 1%.
The group's own retail network saw a net expansion of 72 stores to a total of 1,113 in the course of the year (2014: 1,041). Sales in the wholesale business fell 3% short of the prior year's level in local currencies in fiscal year 2015. However, this channel showed positive growth in the fourth quarter, with sales up by 2%.
Menswear grew by 3% in local currencies over the full year in 2015. Womenswear showed an above-average currency-adjusted rise of 4%, buoyed up by double-digit growth in BOSS Womenswear.
At 66.0%, the gross profit margin for 2015 was 10 basis points below the prior-year figure (2014: 66.1%).
The positive effects of the disproportionate increase in sales in the group's own retail business did not entirely offset higher discounts. Increased discounting activities, particularly in the U.S., led to a fall in the gross profit margin of 80 basis points to 67.4% in the fourth quarter (2014: 68.2%).
Cost increases in the group's own retail business, partly in connection with the expansion of the store network, as well as investments in the continued transformation of the business model also affected the development of EBITDA before special items, which increased by 1% to EUR 594 million over the full year (2014: EUR 591 million).
This rise was slightly below the company's forecast, which envisaged growth of between 3% and 5%. The adjusted EBITDA margin came to 21.2% for the whole of 2015, 180 basis points down on the prior year (2014: 23.0%).
The consolidated net income attributable to the equity holders was 4% short of the prior-year value at EUR 319 million, due to higher depreciation and amortization and increased financial expenses (2014: EUR 333 million).
Inventories were 10% above the prior year's level at the end of 2015. In local currencies, the increase came to only 3%. Mainly due to the higher inventories, trade net working capital rose by 5% to EUR 528 million (2014: EUR 503 million).
After currency adjustments, this corresponds to a decrease of 2%. The free cash flow declined by 23% to EUR 208 million (2014: EUR 268 million) in fiscal year 2015. This was due to an increase in investments to EUR 220 million (2014: EUR 135 million). As a consequence, net financial liabilities grew to EUR 82 million (2014: EUR 36 million).
The managing board and the supervisory board intend to propose to the annual shareholders' meeting an unchanged dividend of EUR 3.62 per share for fiscal year 2015. In addition, the company is affirming its existing dividend policy, according to which between 60% and 80% of consolidated net income should be paid out to the shareholders.
The proposal corresponds to a payout ratio of 78% of the consolidated net income attributable to the equity holders of the parent company (2014: 75%). ■