H&M's sales tumble, stockpiles grow in March to May

STOCKHOLM (Reuters) - H&M, the world's second-biggest fashion retailer, said local currency sales had tumbled 57% since the start of March compared with a year ago as the COVID-19 pandemic and lockdowns kept most of its stores closed.

Reuters May 08, 2020 00:05:56 IST
H&M's sales tumble, stockpiles grow in March to May

HMs sales tumble stockpiles grow in March to May

STOCKHOLM (Reuters) - H&M, the world's second-biggest fashion retailer, said local currency sales had tumbled 57% since the start of March compared with a year ago as the COVID-19 pandemic and lockdowns kept most of its stores closed.

Online sales grew 32%, it said in a statement on Thursday, covering the trading period from March 1-May 6.

H&M warned on April 3 it would make its first quarterly loss in many decades in March-May, its fiscal second quarter.

It has started to gradually reopen stores from late last month but 3,050 or 60% remain temporarily closed.

"In those markets that have begun to open up, trade in the stores has initially been muted," it said on Thursday in a statement ahead of its annual general meeting later in the day.

H&M said its inventories of unsold goods had grown to just above 41 billion Swedish crowns ($4.2 billion) at the end of April, from 37.2 billion at the end of February and 40 billion a year earlier.

It had flagged last month that stocks would temporarily grow due to the sudden drop in demand linked to the pandemic.

"Costs for markdowns are expected to decrease in absolute figures in the second quarter compared with the second quarter of 2019, but since sales will be significantly lower the markdowns are expected to have a negative effect on the gross margin of 2–4 percentage points," it said on Thursday.

H&M's shares were up 1.9% at 1000 GMT, having been slightly higher earlier in the day. Germany, its single-biggest market, on Wednesday announced steps to ease its lockdown.

In Germany, sales were down 46% so far in the second quarter, while in second-biggest market the United States they were down 71%, the group said.

($1 = 9.8333 Swedish crowns)

(Reporting by Anna Ringstrom and Niklas Pollard, editing by Helena Soderpalm and Keith Weir)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

Guinea president 'captured', govt dissolved, claim army putschists'; attack on presidential palace repulsed, say authorities
World

Guinea president 'captured', govt dissolved, claim army putschists'; attack on presidential palace repulsed, say authorities

Reports suggest that they captured President Alpha Conde and dissolved the government, bust the ground situation remains unclear

Cryptocurrency prices tumble and exchange trading falters as snags crop up
News & Analysis

Cryptocurrency prices tumble and exchange trading falters as snags crop up

NEW YORK (Reuters) -The price of cryptocurrencies plunged and crypto trading was delayed on Tuesday, a day in which El Salvador ran into snags as the first country to adopt bitcoin as legal tender. Shares of blockchain-related firms also fell as crypto stocks were hit by trading platform outages. But the major focus was on El Salvador, where the government had to temporarily unplug a digital wallet to cope with demand.

Ford poaches Apple's car project chief Doug Field
News & Analysis

Ford poaches Apple's car project chief Doug Field

By Joseph White and Sanjana Shivdas (Reuters) -The head of Apple Inc's car project, Doug Field, is going to work for Ford Motor Co to lead the automaker's advanced technology and embedded systems efforts, a hiring coup for Ford Chief Executive Jim Farley.