H&M nine months' sales up 7 per cent

30 Sep '17

3 min read

Courtesy: H&M

The H&M group's sales including VAT increased 7 per cent to SEK 173,290 million (161,767) during the first nine months from December 1, 2016 to August 31, 2017. The company's sales excluding VAT amounted to SEK 149,597 million (139,547), an increase of 7 per cent. In local currencies, the sales increased by 4 per cent for the same period.

For the third quarter of fiscal 2017, the company's sales including VAT increased by 5 per cent to SEK 59,383 million (56,802). Sales excluding VAT amounted to SEK 51,229 million (48,982), an increase of 5 per cent. In local currencies, sales increased by 4 per cent. Gross profit amounted to SEK 26,350 million (26,471), corresponding to a gross margin of 51.4 per cent (54.0).

"The fashion retail sector is growing and is in a period of extensive and rapid change as a result of ongoing digitalisation. The competitive landscape is being redrawn, new players are coming in and customers’ behaviour and expectations are changing, with an ever greater share of sales taking place online," said Karl-Johan Persson, chief executive officer.

H&M’s online store will open in further two markets in 2017 - the Philippines and Cyprus - in addition to the six online markets that have already opened in 2017. The roll-out of online markets will continue during 2018 with among others in India. The plan is to offer e-commerce in all of the store markets in the future as well as in other markets. The group’s online sales are estimated to grow by at least 25 per cent per year going forward.

"This shift is clearly reflected in our online sales, which continue to develop very well. However, our growing online sales did not fully compensate for reduced footfall to stores in several of our established markets, which has resulted in our total sales development not reaching our targets so far this year. This is of course something that we are not satisfied with and which, among other things, resulted in that we entered the third quarter with inventory levels that were too high," added Persson.

"We are continuing to develop our assortment within all our brands, while at the same time rapidly making the following investments in order to seize the opportunities that arise with the shift within the industry. We are looking forward to our capital markets day in February 2018, at which we will have the opportunity to tell more about how we are addressing the significant changes taking place in the industry and how we will further strengthen our position going forward," concluded Persson. (RR)

Fibre2Fashion News Desk – India

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