The Swedish clothing group Hennes & Mauritz AB had to accept sales losses in the third quarter of the 2024/25 financial year, but was able to significantly increase its profit. This emerges from a current annual report that the parent company of brands such as H&M, Cos, Monki, Weekday, & other Stories and Arket released on Thursday.
In the period from June to August, the group turnover was 57.0 billion Swedish crowns (5.2 billion euros). He fell by three percent compared to the previous year. In the respective local currencies, however, the proceeds increased by two percent.
Negative currency effects put a strain on sales development
In Western Europe, by far the most important market region of the group, the quarterly turnover rose by one percent (currency -adjusted +3 percent) to almost 19.9 billion Swedish crowns. In the Nordic countries, he declined by one percent to 5.2 billion Swedish crowns, and was roughly stable.
In Asia, Oceania and Africa, the proceeds were around 6.4 billion Swedish crowns and thus by ten percent (currency -adjusted -2 percent) below the relevant previous year. In America, they shrank by eight percent (currency -adjusted +1 percent) to 12.1 billion Swedish crowns.
In Eastern Europe, sales with 5.4 billion Swedish crowns were roughly at the level of the same period in the previous year, and it grew by three percent. In southern Europe, the group had to accept a minus of four percent to 7.9 billion Swedish crowns (adjusted for currency +3 percent).
Cost reductions ensure strong profit growth
Despite the decline in sales, the clothing provider was able to significantly improve his result. The gross margin increased compared to the same period last year despite the somewhat more extensive price reductions from 51.1 to 52.9 percent, which, according to the company, was due to improvements in the supply chain and currency effects. The group was also able to reduce its operational costs. The operational profit rose 40 percent to 4.9 billion Swedish crowns compared to the previous year. The net profit, which is due to the shareholder, grew by 39 percent to 3.2 billion Swedish crowns (293 million euros).
In the first nine months of the current financial year, the group turnover was 169.1 billion Swedish crowns. He was two percent below the corresponding level of the previous year, but was added by two percent. The net profit, which is due to the shareholders, fell by almost ten percent to 7.8 billion Swedish crowns.
In the first weeks of the fourth quarter, there was no upward trend. In September, according to current knowledge of the management, the proceeds will be approximately the level of the previous year’s month. The company also warned that the result of the results due to discounts will be somewhat higher in the fourth quarter than in the previous year.