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Worse than expected for clothing company, Hennes & Mauritz

Thursday, 29 March 2012
Hennes & Mauritz (H&M) reported a profit before tax of Skr3.701million against Skr3538 same time last year,  for the first quarter (December-February) in the split financial year 2011/2012.

Analysts had expected the pre tax earnings of an average of Skr 4.142 million.
The result was thus 11 percent less that expected according to analysts forecast summary.

The H&M Group’s sales including VAT increased by 13 percent in local currencies in the first quarter. Sales in comparable units increased by 3 percent. Converted into SEK, sales excluding VAT amounted to SkrK 27,832 million against Skr24,503million similar period a year ago.

Gross profit amounted to Skr 15,537 million against Skr14,174 same period last year, corresponding to a gross margin of 55.8 percent (57.8). The decrease in the gross margin is due to increased purchasing costs combined with the fact that H&M has chosen not to raise its prices to customers. Increased markdowns have also contributed to the gross margin decrease.
Profit after financial items amounted to Skr 3,701million (Skr3,538m). Group profit after tax amounted to Skr 2,739 million (Skr2,618), corresponding to Skr 1.65 (Skr1.58) per share.

According to the company's report, during the first quarter, 29 stores opened while 10 items  were closed.
Furthermore, repeat H & M to the company in autumn 2012 will start online sales in the U.S..
Successful opening in Sofia, Bulgaria in March. Also it report that by the end of 2012 H&M will have opened stores in five new countries: Bulgaria, Latvia, Malaysia, Mexico and, via franchise, Thailand.
By Team

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