Nov 15, 2011
Reading time
2 minutes
Download the article
Click here to print
Text size
aA+ aA-

H&M October sales better than expected

Nov 15, 2011

Swedish fashion group Hennes & Mauritz AB (H&M) posted a fall in sales at established stores for a second straight month in October as the global slowdown continued to bite, but figures were not down as much as expected by analysts.

H&M's first store in Croatia

Plummeting consumer confidence across Europe and elsewhere around the world has cast a shadow over clothing retailers in recent months.

H&M said same-store sales in October fell 2 percent, against an average forecast for a drop of 3 percent in a Reuters poll.

Total turnover -- including newly opened stores -- rose 8 percent in local currencies versus the poll average of a 6.3 percent rise.

"It looks really good. Given the warm weather, it is very strong of H&M to achieve figures as good as this," said one analyst who declined to be named.

With recession stalking Europe and the U.S. economy sluggish, consumers have been tightening their purse-strings instead of splashing out on new fashion items in recent months.

H&M has seen sales in stores open for a year or more decline in four of the last five months. The only exception was August when sales were flat.

Costs, mainly for cotton and labour, have also been rising, and H&M blamed a warm autumn -- and global uncertainty -- for a poor September, when same-store sales were down 7 percent.

In September, H&M posted third-quarter pretax profit down 15 percent, saying that while markets were challenging it was gaining market share. Sales from comparable stores fell 7 percent in September compared with a year earlier.

Rival Inditex, home to Zara and which ranks as the world's no.1 apparel retailer, has said sales growth has slowed since the end of July.

H&M does not provide comment with its monthly sales figures. (Editing by David Holmes)

© Thomson Reuters 2023 All rights reserved.