Business

Asia slowdown hurts Hugo Boss sales

Hugo Boss label Image copyright Reuters

Shares in German fashion Hugo Boss have sunk 10% after it said trading in the third quarter of the year had been weaker than expected.

The company blamed a deteriorating market environment in Asia and a slowdown in the US.

It cut its 2015 growth forecasts for sales and core profits to 3%-5%.

The news comes a day after shares in British fashion house Burberry declined by 8% because of falling revenues in Asia.

Burberry said trading in China had become "increasingly challenging". The slowdown in China's economy has hit demand for many luxury brands.

'Ambitious' target?

Hugo Boss said sales in the July to September period had experienced "high levels of volatility", with total group sales down 1% when the impact of currency movements were excluded.

The company had previously predicted its core profits would rise by 5%-7% this year, and it said its revised estimate of 3-5% assumed that "fourth-quarter retail comparable store sales will remain stable or develop positively compared to the prior year quarter".

Andreas Riemann, an analyst at Commerzbank, said this revised outlook still seemed "ambitious".

Hugo Boss' shares were down 9.9% in late morning trade.

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