H & M declares its full year and fourth quarter results.
- The H&M Group’s sales including VAT increased in local currencies by 11 percent during the financial year. Sales in comparable units increased by 1 percent. Converted into SEK, sales excluding VAT amounted to SEK 120,799 m (109,999), an increase of 10 percent.
- Gross profit amounted to SEK 71,871 m (66,147), corresponding to a gross margin of 59.5 percent (60.1).
- Profit after financial items amounted to SEK 22,285 m (20,942). The Group’s profit after tax increased by 7 percent to SEK 16,867 m (15,821), corresponding to SEK 10.19 (9.56) per share. Profit after tax increased by 1 billion SEK despite negative effects from the Group’s large long-term investments and negative currency translation effects.
- Strong expansion during the year. The Group opened 304 (266) new stores net compared to originally planned 275. China and the US were the largest expansion markets.
The Fourth Quarter
- The H&M Group’s sales including VAT increased by 9 percent in local currencies in the fourth quarter. Sales in comparable units were unchanged. Converted into SEK, sales excluding VAT amounted to SEK 32,502 m (30,952).
- Gross profit amounted to SEK 20,017 m (19,150), corresponding to a gross margin of 61.6 percent (61.9).
- Profit after financial items amounted to SEK 6,636 m (6,802). Group profit after tax amounted to
- SEK 5,287 m (5,357), corresponding to SEK 3.19 (3.24) per share. Profits after tax were affected by large long-term investments as well as negative currency translation effects of approximately SEK 240 m.
Comments by Karl-Johan Persson, CEO
“H&M continues to stand strong in a challenging clothing market which in many countries has been even more challenging in 2012 compared to 2011. The fact that we increased sales by 11 percent in local currencies and 1 percent in comparable units whilst continuing to gain market share proves once again that customers appreciate our collections, which offer a wide range of inspiring fashion for everyone.
We increased our profits by 1 billion SEK – i.e. an increase of 7 percent compared to the previous year – despite negative effects from large long-term investments and currency translation effects.
Our long-term investments relate to a number of areas such as online shopping, IT, a completely new brand & Other Stories and future broadening of the product range. These long-term investments have created cost increases and to a great extent have not yet generated any revenue.
However, we consider these investments to be both necessary and wise as they aim to secure future expansion and profits and thereby further strengthen H&M’s position.
We continued our strong expansion and opened 304 new stores net during 2012. Five new markets were added and we created around 10,000 new jobs. Today we have a strong global presence with over 2,800 stores in 48 markets and more than 104,000 employees.
Sustainability is becoming increasingly important and one element of our strong offering is also that our increasingly aware customers see H&M as the more sustainable option. Sustainability is therefore high on our agenda; it is an integral part of our operations and has been so for some time.”