Annual Report 2021

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Income statement (in EUR million)



Jan. – Dec. 2021


Jan. – Dec. 2020


Change in %








Cost of sales







Gross profit







In % of sales






80 bp

Operating expenses







In % of sales






1.950 bp

Thereof selling and distribution expenses







Thereof impairment charges1







Thereof administration expenses







Operating result (EBIT)







In % of sales






2.030 bp

Financial result







Earnings before taxes







Income taxes






< (100)

Net income







Attributable to:







Equity holders of the parent company







Non-controlling interests







Earnings per share (in EUR)2







Income tax rate in %








In fiscal year 2020, HUGO BOSS recorded material non-cash impairment charges related to the negative impact of COVID-19 on the Group’s retail business.


Basic and diluted earnings per share.

At 61.8%, the gross margin in fiscal year 2021 was 80 basis points above the prior-year level (2020: 61.0%). This development mainly reflects non-recurring negative inventory valuation effects in the prior year, which more than compensated for an increase in sourcing costs in 2021. The latter is primarily due to pandemic-related shortages in global production and logistics capacities as well as the related increase in material, production, and freight costs. Sourcing and Production

Development of gross profit and gross margin

2021 2020 +45% 1,721 1,187 61.8 61.0 Gross profit (in EUR million) +80 bp Gross margin (in %)

Operating expenses increased by a total of 5% in fiscal year 2021. As a percentage of sales, operating expenses decreased significantly to a level of 53.6% (2020: 73.1%). A step-up in brand and digital investments as part of “CLAIM 5” was largely offset by efficiency gains, particularly in the Group’s own retail business, as well as strict cost management, which was enforced in particular in the first half of the year. The latter also includes government grants and rent relief in light of the COVID-19 pandemic, with the related income in total amounting to the prior-year level. Notes to the Consolidated Financial Statements, Notes 2, 3, 9

Development of operating expenses

2021 2020 Operating expenses (in EUR million) Operating expenses (in % of sales) +5% 1,423 1,493 73.1 53.6 (1,950) bp

Selling and distribution expenses increased by 5% compared to the prior year and totaled 42.7% of sales (2020: 58.5%). Expenses for the Group’s own retail business (brick-and-mortar retail business and own online business) included in this item totaled EUR 695 million, thus remaining slightly below the level of the prior year (2020: EUR 720 million). Excluding non-cash impairment charges, this corresponds to an increase in retail expenses of 9%, mainly reflecting the gradual normalization of rental and personnel expenses as well as the strong sales momentum in the Company’s online business. In line with its strategic claim “Boost Brands”, HUGO BOSS also increased its marketing investments to EUR 204 million in fiscal year 2021 (2020: EUR 159 million). This primarily reflects the execution of key initiatives to increase brand relevance, including the branding refresh as well as collaborations with brands and businesses such as those of BOSS with Russell Athletic and the NBA. As a percentage of Group sales, marketing investments thus totaled 7.3% (2020: 8.2%), fully in line with the target corridor of 7% to 8%, as set out in “CLAIM 5”. Notes to the Consolidated Financial Statements, Note 2, Group Strategy, “Boost Brands”

Administration expenses in the reporting period were 6% above the prior-year level. As a percentage of sales, this corresponds to a decrease to 10.8% (2020: 14.6%). In this context, general administration expenses increased by 8% to EUR 245 million (2020: EUR 227 million), mainly reflecting higher personnel expenses in light of the strong business performance. Research and development expenses incurred in connection with the collection development declined by 2% compared to the prior-year level, amounting to EUR 57 million (2020: EUR 58 million). Notes to the Consolidated Financial Statements, Note 3, Research and Development

In light of the strong top-line improvement, the operating result (EBIT) also recorded a significant increase. Overall, EBIT amounted to EUR 228 million in fiscal year 2021 (2020: minus EUR 236 million). The earnings development was also supported by improvements in gross margin as well as the leveraging of operating overhead. Consequently, the EBIT margin in 2021 was 8.2% (2020: −12.1%). At EUR 339 million, depreciation and amortization was significantly below the prior-year level (2020: EUR 465 million). Excluding non-cash impairment charges, this corresponds to a decrease of 13%, mainly reflecting a decrease in right-of-use assets. Net Assets

Development of EBIT and EBIT margin

2021 2020 (236) 228 >100% EBIT (in EUR million) (12.1) 8.2 +2,030 bp EBIT margin (in%)

At minus EUR 31 million, the financial result (net financial expenses) in fiscal year 2021 was 17% below the prior-year level (2020: minus EUR 38 million). The improvement primarily reflects a decrease in interest expenses in connection with lower leasing and financial liabilities. Against the backdrop of the strong business performance in 2021, the Group tax rate normalized to a level of 27% (2020: Group tax rate of 20%, supported by an income tax relief of EUR 54 million). Accordingly, the Group’s net income for fiscal year 2021 amounted to EUR 144 million (2020: minus EUR 219 million). Notes to the Consolidated Financial Statements, Note 4 and 5