Moss Bros ditches Hugo Boss

7th Feb 2011 07:30

Suit hire and sale company Moss Bros is selling its 15 Hugo Boss franchised stores to Hugo Boss UK for £16.5m as part of a move to simplify the business and focus on its core Moss brand.The firm, which has run the stores since 1995, will get £4.2m in cash on 1 April and the remaining £12.3m by the end of 2011. "This is a transformational deal for Moss Bros and absolutely in line with our recently developed strategy of focusing on growing our own brands," chief executive Brian Brick said Monday.It comes as the group confirmed trading over the key Christmas trading period went well, with total sales and margins continuing a positive like-for-like trend. Like-for-like sales rose 7% in the 26 weeks to 29 January and increased by 9.1% for the 52 weeks, and with gross margin also continuing to perform well, directors remain "confident of the outturn for the full year".They'll also have fun spending the money from the Hugo Boss deal on redeveloping Moss branded stores and rolling out new initiatives such as Moss Bespoke.The windfall also means the firm won't need to renew its current banking facilities and will operate debt-free."This transaction will give us the opportunity to focus exclusively on investing and developing the brands which we own, from a position of operational and financial strength," said Brick. "There is significant untapped potential in our position as the UK's number 1 branded suit specialist, with our unique offering of hire, strength in retail and innovation in new areas such as Moss Bespoke."