PARIS – H&M Group gross sales remained flat within the third quarter whereas the corporate tightly diminished its stock and minimize labor prices.
In reported phrases, gross sales elevated by 6 p.c to 60.89 billion Swedish kronor, or 5.22 billion euros at present trade. However they remained flat year-over-year in native currencies.
“Throughout the quarter the main focus has been on profitability and stock effectivity, leading to robust money move and good revenue growth,” mentioned chief govt officer Helena Helmersson. “We’re taking additional steps in the direction of our targets and creating good situations for worthwhile development over time.”
The Swedish foreign money has seen a 17.5 p.c slide in opposition to the euro over the previous 12 months, and reached an all-time low in opposition to the euro in June.
H&M will purchase again shares value 3 billion Swedish kronor, or about 257 million euros, of its personal inventory.
Because the group has targeted on rising its margins and full-price gross sales, it has tightly managed stock move to compensate for provide chain hiccups final 12 months. Stock was down 21 p.c in fixed foreign money from a 12 months earlier.
Gross sales at its portfolio of manufacturers, together with Cos, Monki, Weekday, & Different Tales, Low-cost Monday and Arket, had been up 10 p.c in native currencies.
“Gross sales within the third quarter began strongly with pent-up demand for summer time clothes following a chilly Could in most of our main markets. The impact then steadily decreased through the summer time. There was a weaker finish to the quarter, with comparative figures affected by the momentary reopening in Russia in August final 12 months. Having now moved into September, we are able to see that the beginning of the autumn season has been delayed as a result of the month to date has been marked by unusually sizzling climate in a lot of our European markets,” mentioned Helmersson.
Gross sales transferring into the autumn season had been wanting down as properly, shedding 10 p.c in native currencies year-over-year. The group partially attributed to the lack of its Russian enterprise, which closed in November 2022, and a write down of two.1 billion Swedish kronor.
“We anticipate pent-up demand to return by following a late begin to the season, nonetheless the weak September determine will increase the chance of upper clearance given a shorter promoting window for autumn clothes,” famous RBC analyst Richard Chamberlain.
Working revenue was up barely to 4.74 billion Swedish kronor, or 403.2 million euros, which was boosted by price cuts in native markets.
