Swedish clothing chain H&M Group almost tripled its operating profit to SEK 2.08 billion (181 million EUR) in the first quarter of its financial year, but sales fell slightly. The company, which is the world’s second-largest retailer of low-priced clothing, said in an earnings report today. The company closed the first quarter of its 2024 financial year on February 29.
Management changes
The company also announced that its nominating committee has proposed Helen Saxon as a new member of the board of directors. Saxon is currently CFO of Swedish investment group Investor AB and a member of the board of SEB Bank. She will replace Skype founder Niklas Zennström, who did not seek re-election.
Management noted that it continues to closely monitor developments in the Red Sea, where Yemeni rebels have been attacking merchant ships since last year. Some vessels are therefore avoiding the area, preferring to take the longer and more expensive route around the southern tip of Africa on the route between Asia and Europe. The company said it is trying to minimise the impact on the availability of its products and also keep costs under control.
Beating analysts’ estimates
Operating profit for the first quarter beat analysts’ estimates, which averaged SEK1.43 billion, according to LSEG. Net sales were down around two per cent year-on-year to SEK 53.7 billion, but the market had expected a more significant decline. H&M shares thus opened today’s trading up more than 13 percent.
New CEO Daniel Ervér said the spring collection had been well received by customers. He said sales for the month were up about two per cent. H&M’s main rival is Spanish company Inditex, which owns Zara and other brands.
source: ÄŒTK
