|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's Range||18.10 - 18.10|
|52 Week Range||13.37 - 18.78|
|Beta (3Y Monthly)||1.31|
|PE Ratio (TTM)||20.32|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
(Bloomberg) -- Hennes & Mauritz AB surged after the struggling Swedish clothing retailer showed progress coping with a buildup of unsold garments, raising hopes that the worst may be over after a three-year slump in earnings.Inventory dropped slightly as a proportion of sales, easing to 18.2% at the end of May from a record 18.9% as of last August, H&M said Thursday. Chief Executive Officer Karl-Johan Persson said H&M still aims to boost operating profit this year. The stock rose as much as 11% Thursday in Stockholm.A pickup in revenue growth at the start of the third quarter, helped by a heat wave in Europe, is boosting optimism that the retailer may have returned to a level of sales growth that could gradually put the inventory issue behind it. H&M pledged to reduce discounts for a fourth consecutive quarter as it aims to reduce its 40-billion kronor ($4.5 billion) buildup of unsold garments.Analysts pointed to the June revenue growth of 12% as the trigger for the share gain. The stock can be volatile because short sellers have targeted H&M, betting against almost a fifth of the freely traded shares.Better CompositionThe retailer said that the composition of inventory has improved, implying it will become easier to sell the garments. The family-controlled company has a goal of eventually reducing stock-in-trade to 12% to 14% of sales, a level last seen three years ago. When asked in an interview if that could take four of five years, CEO Persson said it should be less than that, saying he’s “confident” H&M is heading in the right direction.“H&M is improving its offer, which should lead to a sales and earnings recovery in time, albeit with execution risk in an ongoing tough competitive environment,” wrote Richard Chamberlain, an analyst at RBC Europe.The company has recently been offering discounts of up to half off on summer clothes, offering $1.99 camisole tops, $25.99 faux leather biker jackets and skinny jeans for $8.99.H&M also cut this year’s store expansion plan by 26% while pledging more investment in e-commerce. H&M now expects 130 net store openings, further decelerating from a rate that exceeded 400 in recent years. Most of the new H&M shops will be outside of Europe and the U.S. as the retailer seeks faster-growing markets.H&M has been plowing investment into e-commerce, adding online sales in Mexico, Thailand, Indonesia and Egypt this year.The Swedish retailer is trying to catch up after Zara owner Inditex SA made it possible to order clothes from its chains from virtually anywhere in the world. H&M’s e-commerce reach extends to about 48 markets.Inditex has forecast sales growth of 4% to 6% this year on a like-for-like basis as the Spanish retailer outperforms rivals such as Gap Inc.H&M is also trying to catch up with Inditex’s lead in RFID, a technology that allows retailers to track the location of clothes in stores and warehouses to boost efficiency. The Swedish retailer said it now uses RFID in 15 markets. Zara uses it in all its stores.The Swedish retailer said it plans to launch H&M on Indian e-commerce platform Myntra and its & Other Stories chain on China’s Tmall by this autumn.H&M warned that the weak krona is still pushing up buying costs as the retailer buys the bulk of its garments in Asia, where prices are linked to dollars. The krona was on average about 10% weaker against the dollar in the second quarter.Pretax profit dropped 1.3% in the three months through May, missing analysts’ estimates and declining an eighth consecutive quarter.To contact the reporters on this story: Thomas Mulier in Geneva at firstname.lastname@example.org;Hanna Hoikkala in Stockholm at email@example.comTo contact the editors responsible for this story: Eric Pfanner at firstname.lastname@example.org, John J. Edwards IIIFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Hennes & Mauritz AB revenue growth showed a slowdown in April and May, stymieing the Swedish clothing retailer’s attempts to reduce a buildup of inventory that’s been weighing on earnings.Sales in the latest quarter were above analysts’ estimates as compiled by Bloomberg News. But the figures suggest growth slowed to 5.5% in April and May from a 7% rate in March, wrote Fredrik Ivarsson, an analyst at Kepler Cheuvreux. That suggests stock-in-trade probably increased 4% in local currencies at the end of May, said Ivarsson, who estimates earnings were flat for the quarter. The shares fell 1.8% as of 9:53 a.m. in Stockholm, having earlier dropped as much as 3.1%.Clothing retail has been a difficult market lately, with Inditex SA reporting weak sales recently due to rainy and cold weather and Gap Inc. suffering a 10% drop in revenue at its namesake chain. H&M, which had pledged to reduce discounts, said turnaround initiatives are starting to work, though challenges remain. The biggest of those is that backlogs are standing near the equivalent of a fifth of total revenue.“We expect inventories to remain high at the end of the second quarter,” wrote Richard Chamberlain, an analyst at RBC Europe. He added that H&M faces a risk that customers may start to expect discounts the longer inventories build up.H&M is scheduled to report earnings on June 27 for its second quarter, which ran through May. Analysts expect a 3% increase in operating profit, which would be the first gain in two years.\--With assistance from Hanna Hoikkala.To contact the reporters on this story: Anna Molin in Stockholm at email@example.com;Thomas Mulier in Geneva at firstname.lastname@example.orgTo contact the editors responsible for this story: Katerina Petroff at email@example.com, ;Eric Pfanner at firstname.lastname@example.org, John J. Edwards IIIFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
H&M had to offer less discounts to tempt shoppers, and expected this to continue in the current quarter. H&M has continued to invest in new concepts, such as Arket, a Nordic inspired store that includes fashion and home furnishings. A new H&M in the City of London has a fresh image that looks to have borrowed from Arket’s aesthetic.
COPENHAGEN, Denmark (AP) — Swedish low-cost fashion brand Hennes & Mauritz AB has announced first-quarter profit dropped to 803 million kronor ($86.4 million), down from 1.4 billion kronor a year ago, saying the earlier period was positively affected by one-off tax income as a result of U.S. tax reform.
To help it, the Swedish company just hired a man best known for revealing a data privacy scandal that rocked Facebook Inc. and raised serious questions around how some corners of technology are shaping human existence. At H&M, 29-year-old Christopher Wylie will help the company use big data and artificial intelligence to make sure it actually designs things shoppers want. If successful, the Cambridge Analytica whistle-blower might be able to help fix some of H&M’s most pressing issues, including getting its inventory under control and ultimately making the company more profitable.
Swedish low-cost fashion brand Hennes & Mauritz AB said Thursday its fourth-quarter profit dropped about 10 percent to 3.5 billion kronor ($390 million) as consumers continued to shift to online shopping. The Stockholm-based group retailer said quarterly sales increased by 12 percent to 56.4 million kronor ($6.22 million), while full-year sales rose 5 percent to 210.4 billion kronor ($23.2 billion). Chief Executive Karl-Johan Persson said 2018 had been a "challenging year" but that the company is changing to adapt to new customer habits, including more online shopping.
Several prominent clothing retailers are revamping their manufacturing and tailoring their brand images for just this kind of change. J. Crew Group, for example, recently debuted its “Eco Jean,” a selection of denim it boasts is made from “sustainably dyed organic Italian cotton.” Earlier this year, Levi Strauss & Co. announced a new initiative that eliminates many chemicals from its jeans manufacturing process and reduces textile waste. The environmental concerns around clothing manufacturing are more acute than ever before.
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