H&M reported weaker-than-expected sales and profits

H&M reported weaker-than-expected sales and profits in the first quarter as discounts and a strong Swedish currency weighed on revenue at the world’s second-largest fashion retailer, AFP reported.
H&M said net profit fell 53 percent to 579 million kronor ($57.5 million) between December and February, the first three months of the group’s fiscal year.
Sales rose three percent to 55 billion kronor, helped by its women’s collections.
“Although we have made significant progress on our plan and have good control over costs, our sales and earnings in the quarter were slightly weaker than planned,” H&M Chief Executive Daniel Erver said in a statement on the results.
“But the first quarter is our weakest quarter of the year in terms of sales and margin, and we are confident about the future,” he added.
Its profit margin was negatively affected by “increased markdowns” and the strong kroner, the company said.
H&M expects sales to increase by one percent in local currencies in March.
“We see that the improvements we have made, especially in the women’s range, are starting to have a positive effect,” Erver said.
“Here we have simplified the organization and become faster in adapting to new trends and creating a more relevant range.” | BGNES, AFP