Aeffe, Hugo Boss and Ralph Lauren’s unstable results

Aeffe, Hugo Boss and Ralph Lauren fight the effects of the pandemic with unstable results. The online channel and China seem to be the only two valid resources during this critical time.

Aeffe, Hugo Boss and Ralph Lauren

Aeffe, group that controls Alberta Ferretti, Philosophy di Lorenzo Serafini, Moschino (to the right, in picture taken from moschino.com) and Pollini, closed its first semester 2020 with consolidated revenue of 118.9 million Euro, -31.4% at both current and constant rates. During the April-June quarter sales dropped by 40%, which according to the company is a consequence of “the delay of shipments past June 30^th, 2020”.

The semester ended with a net loss of 10.9 million euro, compared to the 5.1 million euro profit of the same period of 2019. Revenue from footwear and leather goods (worth about 35% of total income) contracted by 21.4% at current and constant rates, which is still better than the -33% recorded by the prêt-à-porter division. As far as brands go, at constant rates, Moschino (worth 79% of total revenue) lost 27.5%, while Pollini’s decrease was of 39.6%. Aeffe took many measures to face this difficult period, such as those mentioned by the group’s executive president Massimo Ferretti, who commented “the further outsourcing of part of production to ensure punctuality of delivery for the Fall/winter collection of 2020, and other investments in the group’s digital strategy”.

The Germans fair no better

China and the online channel mitigate Hugo Boss’s losses. The German brand (in left image taken from hugoboss.com is a suede product sold by the brand), closed its first semester with 830 million Euro of revenue, down 38% at current and constant rates. The period’s operating loss was of 204 million euro, compared to the 89 million euro profit recorded during the same period of the previous year. Specifically, during the period April-June, sales were 275 million euro, down 59% from the comparable period of 2019. “The 2^nd quarter was as challenging as expected.

The attention we placed on all the tutelage and stability of Hugo Boss’ financials – states Yves Müller, spokesperson for the board, – helped generate strong cashflow in the 2^nd quarter”. Sales in China grew by 4% during the same period (on yearly base), while online sales increased by 74%. Hugo Boss chose not to provide any complete forecasts for the full year, but the group has said itself optimistic on global retail sales as they are to gradually improve, with positive consequences on results during the 2^nd half od the year.

“An extrordinary challenge”

Ralph Lauren’s sales for the April-June period (1^st quarter of the 20/21 fiscal year) dropped by 65.8% to 487.5 million USD (-65% at constant rates). Analysts expected revenue to be of 615 million USD, while net losses amounted to 127.7 million USD, down from the 117.1 million USD profit of last year’s comparable period. Again, the losses were greater than those forecasted by analysts.

“These last few months have been an extraordinary challenge, but they have also been a test of agility and resilience – says trice Louvet, president and CEO of Ralph Lauren –. We believe results for the 2^nd quarter and the entire 2021 will be negatively impacted by the pancemic and the slow recovery of demand”. Ralph Laurent is mosre exposed to the health crisis than other clothing brands due to the fact that its jackets and clothing are designed for more social or formal occasions, said Neil Saunders, CEO of research firm GlobalData Retail, to Reuters.

Read also: