Swedish High Street fashion retailer H&M missed analysts profit forecasts in the third quarter, blaming bad weather and foreign exchange rates.
Group sales grew by 19% to SEK 46.02 billion (£3.5 billion, $US5.48 billion), according to figures out on Thursday, but pre-tax profit was flat on last year at SEK 6.93 billion (£540 million, $US820 million). Analysts had been expecting SEK 7 billion (£550 million, $US830 million), according to the FT.
CEO Karl-Johan Persson says in the statement:
Sales were good in the third quarter even though sales in August were negatively affected by the unseasonably warm weather in many of our large European markets. When the weather became more normal in September, sales took off again and we are looking forward to an exciting fashion autumn.
Profits have developed well during the first nine months of the year, although profits in the third quarter were negatively affected by increased purchasing costs due to the strong US dollar.
As well as its flagship H&M stores, Hennes & Mauritz AB also owns High Street brands Cos, Monki, Cheap Monday, and & Other Stories.
H&M launches a line of beauty products in July and Persson says: “H&M Beauty has enjoyed a very good start.”
The retailer is in the midst of launching online shops around the world and plans to open ones in Russia and Switzerland over the next 3 months. An extra 240 stores around the world are also planned, taking its global total to over 3,800.
H&M is also working on sustainability work and said more of its suppliers are beginning to pay the Fair Living Wage.
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