Swedish apparel retailer Hennes & Mauritz has recorded a 20 percent sales increase for the second quarter ended May 31, 2014. The H&M Group’s sales including VAT increased in local currencies by 16 percent during the quarter from March 01, 2014 to May 31, 2014. Converted into SEK, sales excluding VAT amounted to SEK 37,827 m (31,635). Its gross profit amounted to SEK 23,010 m (19,337), an increase of 19 percent. This corresponds to a gross margin of 60.8 percent.
Profit after financial items amounted to SEK 7,643 m (6,125), an increase of 25 percent. The group’s profit after tax increased to SEK 5,809 m (4,655), corresponding to SEK 3.51 (2.81) per share, an increase of 25 percent.
According to the company officials, H&M’s first store in Australia received an overwhelming response since it opened in April. H&M’s online sales in France, which were launched in March, also saw a good start. Strong sales were also recorded for the other brands in the H&M Group including COS, & Other Stories, Monki, Weekday, Cheap Monday and H&M Home
The retailer plans to open approximately 375 new stores net in total. According to the company officials, Philippines and India will become new H&M countries in autumn 2014. Also, Spain, Italy and China will be the three large new online markets for the retailer in autumn 2014. H&M plans to open 8 – 10 new online markets in 2015.
Commenting on the results of the second quarter, Karl-Johan Persson, CEO, H&M, said: ”We have had a good second quarter with a strong increase in both sales and profits and increased market share. Well-received collections and continued strong expansion led to a sales increase of 20 percent in SEK and 16 percent in local currencies. The strong sales development together with good cost control contributed to an increase in operating profits of 26 percent. All our brands – H&M, COS, & Other Stories, Monki, Weekday, Cheap Monday and H&M Home – enjoyed good sales development during the second quarter. We are very pleased that H&M Sport, which we are broadening further, continued to gain market share within the sports segment.”
He further added: “We are continuing to broaden our current offering within H&M. Already this autumn, we will launch an extended and improved shoe range for women, men, teenagers and children. The new shoe concept will offer a variety of models in different price categories, all at H&M prices. The range will be launched in selected H&M stores in nine countries and in our online markets. This is a part of our long-term investments which also includes investments in online, IT and our new brands. We are seeing some of our long-term investments starting to generate revenues such as & Other Stories and our online store in the US and in France. However, we will continue with our long-term investments in order to build an even stronger H&M and to continue with our multi-channel strategy. This autumn, for example, we will open our online store in Spain and Italy, and later on this year also in China, which will be very exciting. Next year we plan to open 8 to 10 new H&M online markets. We will come back later with more information on which markets these will be.”
H & M Hennes & Mauritz AB was founded in Sweden in 1947. The H&M Group has more than 3,200 stores in 54 markets including franchise markets. In 2013, sales including VAT were SEK 150,090 million.