For the three months to May 31, 2015, sales at Swedish apparel retailer soared 21 per cent year over year, despite what it called challenging conditions.
H&M group’s sales surged 21 per cent from a fiscal ago quarter to SEK 45,867 million in the second quarter of fiscal 2016, while in local currencies the increase was more sedate at 10 per cent.
“The quarter has been negatively affected by calendar effects of approximately 2 percentage points,” H&M informed in an interim report.
CEO Karl-Johan Persson said, “Sales development was again strong, if we consider the challenging conditions like unusually cold spring weather and negative calendar effects.”
Gross profit for the reporting quarter amounted to SEK 27,245 million, also up a massive 18 per cent over the same quarter of previous fiscal and posted gross margin of 59.4 per cent as against 60.8 per cent.
Profit after financial items grew slower at 10 per cent and totaled to SEK 8,435 million, while net profit climbed 11 per cent to SEK 6,453 million or SEK 3.90 per share.
For the first half of the current fiscal, H&M group sales excluding VAT too surged 23 per cent to SEK 86,143 million from SEK 69,970 million in the same period of prior fiscal.
“Well-received collections for all brands in the H&M group resulted in good sales and increased market share,” it informed.
Profit after financial items in the period under review reached SEK 13,158 million as against SEK 11,129 million, an increase of 18 per cent.
The group’s profit after tax drove up 19 per cent to SEK 10,066 million or SEK 6.08 per share compared to SEK 8,458 million or SEK 5.11 per share in the first half of previous fiscal.
“Net profits also developed well, this despite that the increasingly strong US dollar has resulted in increased purchasing costs and also an increase in long-term investments,” Persson added.
“Our goal is to offer a customer experience in which online and stores are closely interwoven, which will strengthen our customer offering further,” the CEO observed.
In March and April, the apparel retailer opened eight new H&M online markets, which includes Poland, Portugal, Romania, the Czech Republic, Bulgaria, Slovakia, Hungary and Belgium.
With the opening of H&M shop online in Switzerland in autumn, H&M will have a presence in 22 online markets.
Parallel with its online expansion, H&M is also continuing to open brick-and-mortar stores at a fast pace and aims to open approximately 400 new stores this fiscal.
In the second half of the fiscal, the retailer who operates around 3,000 stores worldwide is planning to open stores in new markets like India and South Africa. (AR)
Fibre2fashion News Desk - India