German fashion house Hugo Boss expects coronavirus restrictions to keep weighing on its business in the first quarter, but forecasts a gradual recovery from the second quarter, helping sales and operating profit rise in 2021.

“Although the pandemic continues to have a severe impact on our business in the short term, I am highly confident when it comes to the further recovery of our business in the course of the year,” said acting chief executive Yves Mueller.

Hugo Boss said it would continue to push more casual styles, a shift it had already made even before customers switched suits for tracksuits when lockdowns forced them to work from home, helped by a new partnership with actor Chris Hemsworth.

It expects sales and operating profit in 2021 to be “well above” the level of 2020.

Hugo Boss reported a 29 percent slump in fourth quarter sales to 583 million euros ($695.29 million), but still managed to record a positive operating profit of 13 million euros as it cut costs.

While many stores remained closed in Europe due to Covid-19 lockdowns in the period, Hugo Boss said its business continued to recover in the US market and the Asia Pacific region, with China recording strong double-digit growth.

Rival Burberry has also seen a strong bounce back in demand in China and South Korea.

Meanwhile, Hugo Boss aid online sales grew fast, up 49 percent in 2020 to more than 200 million euros for the first time as the brand expanded e-commerce to 32 more markets. ($1 = 0.8385 euros)

By Emma Thomasson; Editing by Riham Alkousaa and Caroline Copley