In fiscal year 2022, HUGO BOSS invested EUR 191 million in property, plant and equipment, and intangible assets, representing a strong increase of 84% as compared to the prior-year level (2021: EUR 104 million). The step-up in capital expenditure aims at supporting the successful execution of “CLAIM 5” by increasing the Company’s investments in its global store network and further digitalizing its business model. Consequently, as a percentage of sales, capital expenditure amounted to 5.2%, and thus slightly below the Company’s mid-term target corridor as laid out in “CLAIM 5” (target range for 2022–2024: 6% to 7% of sales; from 2025: between 4% and 5% of sales).
Capital expenditure
(in %)
In line with our strategic claim “Rebalance Omnichannel”, we aim to fully exploit the potential of our brick-and-mortar retail business in the coming years. The optimization and modernization of our global store network plays a key role in this. In this context, we plan to invest a total of EUR 500 million in the further optimization and modernization of our store network by 2025. Our new store concepts are intended to make a significant contribution to developing our points of sale into true points of experience. Already today, our customers can experience the new store concepts of BOSS and HUGO in more than 60 freestanding stores globally. With capital expenditure of EUR 103 million, the focus of investment activity in fiscal year 2022 continued to be on our own retail network (2021: EUR 64 million). Investments in the continuous optimization and modernization of existing locations totaled EUR 78 million (2021: EUR 32 million). At the same time, we invested EUR 25 million in openings of new retail points of sale across all three regions (2021: EUR 32 million), including the new BOSS flagship store in London’s Oxford Street as well as BOSS stores in Rome and Brussels, among others. Group Strategy, “Rebalance Omnichannel”
Capital expenditure on administration amounted to EUR 65 million in the past fiscal year (2021: EUR 33 million). This primarily includes investments of EUR 47 million in our global IT infrastructure (2021: EUR 25 million). In line with our strategic claim “Lead in Digital,” these investments mainly relate to the further digitalization of our business model, including important digital initiatives of the HUGO BOSS Digital Campus as well as the Company-wide rollout of a next-generation ERP system as part of a multiyear project. Other capital expenditure on the Company’s production, logistics, and distribution structure and on research and development amounted to EUR 22 million in 2022 (2021: EUR 6 million). Group Strategy, “Lead in Digital”
Accumulated depreciation and amortization on property, plant and equipment, and intangible assets, including own capitalized cost, totaled EUR 1,175 million in fiscal year 2022 (2021: EUR 1,087 million). Existing obligations from investment projects amounted to EUR 2 million as of December 31, 2022 (December 31, 2021: EUR 2 million). Notes to the Consolidated Financial Statements, Note 8