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H&M profits leap as online expansion continues

Swedish fashion giant H&M announced a 20 percent leap year-on-year in third quarter profits on September 25 but disappointed investors with a slight fall in gross profit margins linked to increased expansion costs. The group's net profits reached 5.3 billion kronor ($735 million, 580 million euros) - less than analysts had expected following strong sales figures for July and August.

September sales were down so far due to "unusually warm weather in most markets", the group said in a statement, adding that gross profit margins had fallen from 58.8 percent to 58.3 percent. Turnover grew by 22 percent to 45.4 billion kronor ($6.3 billion, 4.9 billion euros), driven by the rapid expansion of the group which has diversified its brands, reporting "continued strong sales development" for COS, & Other Stories, Monki, Weekday, Cheap Monday and H&M Home.

"We have continued to gain market share thanks to strong sales development for all our brands. We see this as proof of well-received collections," H&M chief executive Karl-Johan Persson said in a statement.

He added that the group, which currently has 3,300 stores, was on schedule to add another 375 during 2014, opening in the Philippines in October and expanding to South Africa, Peru, Taiwan and Macau in 2015. A planned expansion to India in autumn 2014 was postponed until next year.

The group also continued an online expansion with Internet sales launches in France in March, Italy and Spain in August and China in September.

"Our online openings have taken place at a rapid pace this year. We have had a very good response from customers in all these countries," said Persson, adding that the company planned to open eight to 10 new online markets next year.

Copyright Agence France-Presse, 2014


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Banking Review 2014

Foreign Debt $62.649bn
Per Cap Income $1,512
GDP Growth 4.24%
Average CPI 8.6%
Trade Balance $-2.378 bln
Exports $2.016 bln
Imports $4.394 bln
WeeklyAugust 27, 2015
Reserves $18.509 bln