Impressive sales a boon for H & M
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Wednesday, 22 June 2011
Hennes & Mauritz reported a profit before tax of Skr 5752 million for the split fiscal second quarter against Skr7040million in the past similar period last year.
Analysts had expected its pre tax earnings to reach an average of Skr 5.746 million.
Gross margin was 61.7 percent, compared to the expected 62.2 percent. Similar period last year it was 65.9.
H & M Group sales including VAT increased by 10 percent in local currencies during the first six months. In comparable units, sales rose by 2 percent.
Sales in the Swedish krona has been strongly affected by negative currency translation effects, writes H & M in the report.
CEO Karl-Johan Persson in a comment said that: “Sales were good in the quarter with an increase of 12 percent in local currencies. We continue to gain market shares in a very challenging market, which proves H&M’s strong position. Increasing interest rates, higher energy prices and austerity measures in many economies have decreased consumer spending power. During the spring, the fashion retail industry has been characterised by many price campaigns and special offers.
Our profitability remained strong with an operating margin of 20.3 percent despite strong negative effects from many external factors that were beyond our influence, such as the high cotton prices.”
H&M Performance summary
THE FIRST HALF-YEAR
The H&M Group’s sales including VAT increased by 10 percent in local currencies in the
first six months of the financial year. Sales increased by 2 percent in comparable units.
Sales in SEK were strongly negatively affected by currency translation effects.
Converted into SEK, sales excluding VAT amounted to SEK 52,135 m (51,879).
Profit after financial items amounted to SEK 9,290 m (12,095). Group profit after tax was
SEK 6,875 m (8,950), corresponding to SEK 4.15 (5.41) per share.
THE SECOND QUARTER
The H&M Group’s sales including VAT increased by 12 percent in local currencies in
the second quarter. Sales increased by 2 percent in comparable units.
Converted into SEK, sales excluding VAT amounted to SEK 27,632 m (27,033).
Gross profit amounted to SEK 17,057 m (17,808), corresponding to a gross margin of
61.7 percent (65.9).
Profit after financial items amounted to SEK 5,752 m (7,040). Group profit after tax was
SEK 4,257 m (5,209), corresponding to SEK 2.57 (3.15) per share.
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