H&M focuses on its profitability. The Swedish company, number two in the world in large-scale fashion distribution behind Inditex, has ended the first half of the year (closed last May) with its net profit soaring by 62%. This evolution is the result of the reorganization and cost reduction plan that the company has in place, which in the same period has frozen the evolution of its sales.
“H&M’s profitability during the first half of the year has been strong as a result of gradual improvements in sales performance, a strengthened gross margin and continued better cost control,” explained Daniel Ervér, CEO of the company since beginning of the year. “With four consecutive quarters of increased profitability, we are on track to achieve our long-term goal of profitability exceeding 10%”has added.
At the end of the first six months of the fiscal year, H&M’s net result stood at 6,196 million Swedish crowns (549 million euros)shooting up 61.86% compared to the 3,828 million Swedish crowns (339 million euros) in the same period of 2023.
H&M has closed the first half of the year with a drop in sales in all regions except Eastern Europe
The Swedish company has ended the first six months of the current year with revenues of 113,274 million Swedish crowns (10,039 million euros), which represents a slight increase of 0.69% compared to the same period of the previous year. In the second quarter, sales have risen around 3%.
By region, the company has corrected its evolution in the second quarter throughout the world except in the Asia, Oceania and Africa region. The cumulative figure for the first semester, on the other hand, is negative throughout the world except in Eastern Europe.
The group has closed the first six months of fiscal year 2024 with a gross result of 61,224 million Swedish crowns (5,426 million euros), which has represented an increase of 8.89% compared to the first half of 2023. The gross margin at the end of the first semester stood at 54%.
“The cut of discounts in relation to sales in the second quarter of 2024 has been flat compared to the second quarter of 2023,” the company said, adding that “for goods that will be sold in the third quarter “In 2024, the effect of external factors is expected to be negative compared to 2023.”
In the first semester, The group has continued with the plan to reorganize its network of stores, going from 4,399 twelve months ago to 4,319 at the end of Maywith eighty net closures.
In parallel, the company now plans to enter the Dominican Republic through franchises and maintains the development of its Arket chain with openings in Ireland, Poland, Spain and Italy. Additionally, &Other Stories will begin selling in the marketplace About You.
