PARIS – H&M Group’s fast-fashion juggernaut seems to have slowed.

Net sales were up 12 percent over the holiday shopping season and into 2023 to 54.87 billion Swedish kronor, or $5.19 billion, in a preliminary first quarter trading update released Wednesday. But the company took an exchange rate hit, with sales up just 3 percent year-on-year at constant currency rates in the period from Dec. 1, 2022, to Feb. 28, 2023.

Excluding Russia and Belarus, where the company shuttered its business following the invasion of Ukraine, and Ukraine itself, where stores remain closed during the conflict, sales were up 7 percent in constant currencies.

Those numbers were mixed for analysts, coming in below consensus when taken in constant currency. In addition, sales are expected to soften in February following the holiday period as inflation hits the company’s core consumer.

The announcement sent the stock down 8.7 percent in mid-morning trading.

Looking ahead, analysts said the company’s continued low price point could be a boon for shoppers under price pressures, while its Arket and Cos labels are upping their appeal amongst premium shoppers willing to pay higher prices.

The boost in sales follows fourth quarter losses of $83.9 million reported in January, with the company’s exit from Russia and increased costs hitting its bottom line.

“We think H&M has taken various steps to improve its omnichannel offer for customers, which should lead to it holding its own in major markets,” said RBC Europe analyst Richard Chamberlain. The company’s product mix is strengthening and costs should lower as global supply chain pressures ease.

“H&M’s gross margin outlook is looking stronger for H2 next year,” he noted.

H&M brand has enlisted Mugler creative director Casey Cadwallader for its next collaboration, which will hit stores in the second quarter. Full first-quarter results will be released March 30.

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