STOCKHOLM (Reuters) – H&M reported a 23% rise in first quarter gross sales on Tuesday, which was in step with market expectations, because the world’s second-biggest style retailer makes an attempt to construct on its restoration from the COVID-19 pandemic.
Shares in Sweden’s H&M, which didn’t give any remark in its assertion, had been down 3% in early commerce as analysts targeted on the potential affect of the Ukraine disaster on its enterprise in Central and Jap Europe and wider international repurcussions.
Internet gross sales in H&M’s fiscal first quarter from December via February, its seasonally slowest, had been up by 18% in native foreign money phrases, at 49.2 billion crowns ($5.13 billion), in comparison with a mean forecast from analysts polled by Refinitiv of 49.1 billion crowns.
Credit score Suisse stated in a observe the figures implied a slowdown in local-currency gross sales development to round 14% in February, from the round 20% flagged beforehand for December-January.
H&M earlier this month briefly closed its shops in Russia, which final quarter accounted for 4% of group gross sales, becoming a member of a rising checklist of worldwide firms shunning the nation over its invasion of Ukraine.
RBC analyst Richard Chamberlain stated he had lower revenue estimates for H&M for this yr and subsequent by round 10%, pointing to the Russia retailer closures but in addition the actual fact Central and Jap Europe account for some 12% of group gross sales.
Lower than a month earlier than Russia invaded Ukraine, H&M had drawn a line underneath the pandemic, and several other robust years earlier than that, reporting a soar in revenue and saying it was mountain climbing investments with the intention of doubling gross sales by 2030.
Credit score Suisse analysts famous that whereas Russia accounts for a small share of H&M’s gross sales, the Ukraine disaster may end in a fabric impact on international disposable earnings and demand.
Russia, which calls its actions in Ukraine a “particular navy operation”, has proposed nationalising property of overseas corporations that go away within the wake of financial sanctions.
H&M will publish its full quarterly earnings report on March 31. Its greatest rival Inditex, the proprietor of Zara, is because of report quarterly outcomes on March 16.
($1 = 9.5890 Swedish crowns)
Reporting by Anna Ringstrom; modifying by Niklas Pollard and Alexander Smith
