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Hugo Boss AG reported fourth-quarter results that beat analysts’ estimates as the German fashion house works to close stores and revamp its offerings.
Earnings before interest and taxes reached €154 million ($179 million) last quarter, the German firm said Tuesday. Sales also were higher than expected. The stock surged as much as 7.6 percent in early trading, erasing the decline posted so far this year.
Chief executive officer Daniel Grieder is seeking to revive growth after a challenging period marked by US tariffs, soft demand in China and persistent weakness in womenswear. The reset includes streamlining product assortments, price increases and tighter cost control, as well as a “moderate” net reduction in retail space through store closures.
The company also reiterated profit and sales guidance first outlined in December and proposed paying only the legal minimum dividend of €0.04 per share for fiscal 2025, down from €1.40 a year earlier and below the average analyst estimate compiled by Bloomberg.
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Hugo Boss has also faced scrutiny from its largest shareholder, UK retailer Frasers Group Plc. The company behind the Sports Direct and Flannels brands has argued cash should be invested in long-term growth rather than dividends.
A €200 million share buyback program announced Monday could increase Frasers Group’s stake to about 27 percent from 25 percent, Bloomberg Intelligence analysts Andrea Ferdinando Leggieri and Deborah Aitken said in a note. A 30 percent ownership would trigger a mandatory takeover offer.
By Sonja Wind
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