Deutsche Bank Global Consumer Conference Paris

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2 Deutsche Bank Global Consumer Conference Paris HUGO BOSS Company Handouts June 16, 2011 Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

3 AGENDA STRATEGY UPDATE CURRENT TRADING OUTLOOK BACKUP Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

4 AGENDA STRATEGY UPDATE CURRENT TRADING OUTLOOK BACKUP Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

5 2010 A record year in the Group s history Sales and EBITDA before special items (in EUR million) Sales EBITDA before special items Sales EBITDA 1,800 1,500 1,200 1,496 1,632 1,686 1, , Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

6 GROWTH STRATEGY Project D.R.I.V.E. connects four major growth drivers CONSUMER PROXIMITY INTER- NATIONALI- ZATION D.R.I.V.E. RETAIL BRAND DIFFEREN- TIATION Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

7 CONSUMER PROXIMITY stronger end consumer focus Early incorporation of market information Reducing collection complexity Tailoring POS deliveries to actual consumer demand Introduction of new collection cycle Clearly defined core ranges for directly operated stores Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

8 RETAIL Retail to account for almost half of Group sales by 2015 Retail 22% 33% 40% 48% Wholesale 75% 64% 57% 49% Licenses 3% 3% 3% 3% e Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

9 RETAIL New openings enhance Group store portfolio BOSS Black Shop, Kunming, China Opening date: January 2011 Net Size: 268 m² BOSS Store, Schaumburg / Woodfield, USA Opening date: February 2011 Net Size: 212 m² BOSS Black Store, Harbin, China Opening date: March 2011 Net Size: 160 m² Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

10 BRAND DIFFERENTIATION Clear positioning in the premium and luxury goods segment Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

11 BRAND DIFFERENTIATION New direction for BOSS Selection BOSS Selection repositioned as modern authentic luxury brand that innovates in style and taste New logo and corporate design visualize distinct positioning Highest quality & workmanship Enlarged offer to fit all occasions Important concept to capture growth potential of Asian luxury goods market Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

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13 INTERNATIONALIZATION Non-European share of sales expected to increase strongly until 2015 Asia / Pacific Americas 8% 18% 10% 13% 20% 22% 21% 25% Europe 71% 67% 62% 51% Licenses 3% 3% 3% 3% e Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

14 PROJECT D.R.I.V.E. Lead time reduction from 50 to 38 weeks targeted Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Product Development Past Sales Production Sell Thru Product Development Future 4-cycle Feedback from market, sales, retail sales Sales Production Sell Thru Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

15 PROJECT D.R.I.V.E. Implementation of consumer centric business model 1 Systematic analysis of sellthrough data 5 Active sell - through management Weeks Weeks Desirable brand with best POS performance 2 Consumer insight drives collection planning 4 Focus on wholesale and own retail needs alike 3 Sales floor optimized product development Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

16 PROJECT D.R.I.V.E. Transition to four season cycle a milestone Switch from two major seasons to four-season cycle including monthly themes Adjusts product offering more closely to seasonal changes in consumer demand First dedicated winter collection presented in May, available at retail in October/November Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

17 AGENDA STRATEGY UPDATE CURRENT TRADING OUTLOOK BACKUP Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

18 FIRST QUARTER RESULTS HUGO BOSS has a strong start to 2011 Sales: EUR 539 mill. Ongoing strong momentum throughout the business EUR 444 mill. +21% Double-digit sales increases across all regions, distribution channels and brands Significant profitability uplift driven by gross margin improvement and operational leverage Q Q EBITDA before special items: EUR 132 mill. EUR 92 mill. +43% Q Q Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

19 Robust growth in the key European markets Wholesale business recovers compared to prior year quarter Sales / Europe: EUR 352 mill. EUR 305 mill. +15% Significant sales increases in UK (+24%) and Germany (+16%) Renewed growth in Southern Europe 37% // Other (2010: 36%) Q Q Q Sales by Market / Europe: 26% // Germany (2010: 26%) 13% // Benelux (2010: 14%) 10% // Great Britain (2010: 9%) 14% // France (2010: 15%) Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

20 US wholesale business drives double-digit sales increase in the Americas Sales / Americas: EUR 102 mill. Strength in the US market continues HUGO BOSS brand positioning highly attractive to US wholesale partners Group wins market share EUR 82 mill. +25% Q Q Q Sales by Market / Americas: 9% // Central / South America (2010: 9%) 17% // Canada (2010: 19%) 74% // USA (2010: 72%) Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

21 Booming Chinese market fuels expansion in Asia/Pacific Sales / Asia: EUR 75 mill. Sales in China more than double BOSS Selection supports favorable brand perception in luxury segment Japanese market recovering slowly EUR 48 mill. +55% Q Q Q Sales by Market / Asia: 14% // Japan (2010: 23%) 11% // Other (2010: 12%) 58% // China (2010: 43%) 17% // Oceania (2010: 22%) Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

22 AGENDA STRATEGY UPDATE CURRENT TRADING OUTLOOK BACKUP Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

23 FINANCIAL GUIDANCE 2011 targets confirmed 2011 Outlook 2015 Targets Sales EBITDA before special items Growth of at least 12% (currency-adjusted) Growth of at least 15% EUR 2.5 bill. EUR 500 mill. Capex approx. EUR 90 mill. Own retail network Expansion by around 70 stores Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

24 KEY TAKEAWAYS HUGO BOSS off to a strong start in 2011 Continued strong growth momentum in the first quarter All brands in good shape Execution of growth strategy and implementation of project D.R.I.V.E. key to future success Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

25 AGENDA STRATEGY UPDATE CURRENT TRADING OUTLOOK BACKUP Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

26 FIRST QUARTER RESULTS AT A GLANCE Sales (in EUR million) Gross margin (in %) % 56.2% 58.4% % 50% 40% +2.2 pp % % % 0 0% Q Q Q Q EBITDA before special items (in EUR million) % 132 Q Q Net debt (in EUR million) % 187 Q Q Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

27 SALES BY REGION Broad-based growth Sales development by region, y-o-y Q in euro fx adjusted Europe* 15% 14% Americas 25% 21% Asia/Pacific 46% 55% Group 21% 19% 0% 10% 20% 30% 40% 50% 60% Broad-based growth in Europe led by the UK and Germany Continued strong performance in the US drives increase in the Americas China major contributor to growth in Asia/Pacific *incl. Middle East and Africa Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

28 SALES BY DISTRIBUTION CHANNEL Double-digit increases in all channels Sales development by distribution channel, y-o-y Q in euro fx adjusted Wholesale 13% 10% Retail 42% 38% Royalties 15% 15% Group 21% 19% 0% 10% 20% 30% 40% 50% Wholesale business rebounds from prior year low Strong retail performance due to store network expansion and comp store sales increase (+8%, currency-neutral) Improving fragrance business drives royalty sales Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

29 INCOME STATEMENT First quarter EBITDA margin reaches 24.4% in EUR million Q Q Change in % Net sales Gross profit in % of sales pp Selling and distribution expenses (152.5) (132.8) (15) Administration costs and other operating income and expenses (46.3) (40.6) (14) Operating result (EBIT) in % of sales pp Financial result (6.0) (2.2) <(100) Income taxes (26.4) (17.7) (49) Net income Attributable to: Equity holders of the parent company Earnings per share (EUR) 1 Preferred share EBITDA before special items in % of sales pp 1 Basic and diluted earnings per share. Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

30 Strict working capital management supports further debt reduction Net working capital as a percentage of sales by quarter (in %) 30% 20% 10% 26.1% 24.4% 23.1% 20.3% 17.6% -4.6 pp 15.5% 14.0% 12.9% 13.0% Net debt development 316 EUR 316 mill. EUR 187 mill. -41% 0% Q Q Q Q Q Q Q Q Q Q Q Low year-end net working capital level stabilized Net debt declines by 41% or EUR 129 million compared to prior year Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

31 FINANCIAL CALENDAR 2011 Date Event Publication May 10, 2011 Annual Shareholders Meeting Video Recording July 28, 2011 First Half Year Results 2011 First Half Year Report 2011 Video Recording November 2, 2011 Nine Months Results 2011 Nine Months Report 2011 Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

32 INVESTOR RELATIONS CONTACT Dennis Weber, Head of Investor Relations Phone: +49 (0) Internet: Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

33 FORWARD-LOOKING STATEMENTS CONTAIN RISKS Date 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. Deutsche Bank Global Consumer Conference Paris HUGO BOSS June 16, / 34

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