H&M Reports 21 Percent Quarterly Profit Increase

H&M Reports 21 Percent Quarterly Profit Increase
January 29, 2010

Stockholm, Sweden-based fast-fashion retailer Hennes & Mauritz AB (H&M) announced an increase in its sales figures, reporting that sales for December rose 15 percent, compared to the same month last year, with same-store sales increasing 3 percent, according to The Wall Street Journal. H&M's fourth-quarter net profit increased 21 percent to about $843.2 million. Total sales in the financial year were up 4 percent, following 250 new store openings. These sales numbers represent a turnaround, after seven months of same-store sales declines. For the fourth quarter, H&M reported that gross margin rose to 66.3 percent from 62.4 percent a year earlier, "helped by currency hedging, as well as 'greater surplus capacity at suppliers, efficiencies in the buying process and year-end effects that are mainly due to lower shrinkage than estimated,'" the paper reported. As of Dec. 31, H&M had 1,988 stores, compared to 1,738 at the same time last year. H&M expects to open 240 new stores in the new financial year, mostly located in the United States, United Kingdom, China, France, Germany and Italy.