Low-cost fashion chain H&M sees sales drop 16% due to COVID-19
FILE PHOTO: The H&M clothing store is seen in Times Square in Manhattan, New York, US, Nov 15, 2019. (REUTERS/Mike Segar/File Photo)
STOCKHOLM: Swedish low-cost fashion brand Hennes & Mauritz said on Thursday (Oct 1) its third quarter sales fell 16 per cent to 51 million kronor (US$ 5.7 million), largely as a result of the COVID-19 pandemic.
At the beginning of the quarter, approximately 900 of the group’s more than 5,000 stores were temporarily closed. At the end of the quarter just over 200 stores were temporarily closed.
The Stockholm-based retailing group said its profit after tax for the period between Jun 1 and Aug 31 amounted to 1.8 billion kronor (US$200 million). A year earlier, it had reported a profit of 3.9 billion kronor.
“Through much-appreciated collections and rapid, decisive actions, we returned to profit already in the third quarter,” H&M CEO Helena Helmersson said.
The group said the pandemic had affected all parts of the business, including product purchasing, investments, rents, staffing and financing.
“Although the challenges are far from over, we believe that the worst is behind us and we are well placed to come out of the crisis stronger,” she said of the pandemic.
Currently 166 stores, representing 3 per cent of the total number of stores, are still closed, and the group noted “a large number of stores still have local restrictions and limited opening hours.”
Besides H&M, the group includes brands like COS, Monki, Weekday, Cheap Monday, & Other Stories, H&M HOME, ARKET and Afound. It has about 5,000 stores in 74 markets and approximately 179,000 employees. It sells online in 51 markets.
