The earning power of the HUGO BOSS Group continued to grow in 2007. All performance indicators showed double-digit growth. Operating income (EBIT) rose to EUR 220 million. This corresponds to an improvement of approximately 19% over the previous year (2006: EUR 184 million). Earnings before income taxes (EBT) improved by 18% in 2007 to EUR 212 million (2006: EUR 180 million). Net income also showed an increase of 20% to EUR 154 million (2006: EUR 129 million). This once again set a new record for the Company. Earnings per share rose from EUR 1.84 to EUR 2.22 for the common shares, and from EUR 1.86 to EUR 2.24 for the preferred shares.

Sales rose to EUR 1,632 million and were therefore EUR 136 million or 9% higher the previous year (2006: EUR 1,496 million). Gross profit margin increased in 2007 by 0.9 percentage points over the previous year, to 58.0% (2006: 57.1%). The gross profit of EUR 946 million was EUR 92 million or 11% above the previous year figure of EUR 855 million. A higher share of sales made through the Group’s own retail business and continuing optimization of global production and purchasing structures, particularly in the shoes and leather accessories product segment, were responsible for the positive growth in gross profit margin.

The following key factors influenced the income statement for fiscal year 2007: