Hennes & Mauritz (H&M) will close 250 shops permanently next year. This will be announced by the Swedish fashion chain on Thursday at the presentation of the quarterly figures. The fashion chain is struggling through the COVID crisis with a record build-up of stock. In total, H&M has more than 5000 stores worldwide.
The Swedish company experienced a 16 percent decrease in sales in the third quarter of its broken financial year. This was often due to the fact that stores worldwide had to close their doors. The profit was also much lower, but less than previously predicted.
In the three months to August, H&M had a turnover of DKK 50.8 billion (EUR 4.8 billion). The pre-tax profit was about 2.3 billion krone, compared to 5 billion krone a year earlier. Only last month it was estimated that H&M would earn 2 billion krone.
Sales are now recovering. Sales in September only fell by 5% compared to the same period last year. At the beginning of the third quarter, some 900 stores of the total of more than 5000 stores worldwide were temporarily closed. Right now, there are 166 of them.
“Although the challenges are far from over, we believe that the worst is behind us and that we are well positioned to emerge strong from the crisis,” says CEO Helena Helmersson.
H&M says it’s going to be more responsive to the growing number of customers who buy online clothing by making more digital investments. It also wants to focus more on sustainability, as the chain expects that “demand for products with good value for money will increase in the aftermath of the pandemic”.
Peretz M. is an accomplished economist and financial journalist with a deep understanding of the global economy and financial markets. He is a regular contributor to EconomicInform, where he provides expert analysis and commentary on current economic trends and events. With a strong educational background in economics, Peretz has a talent for breaking down complex economic concepts for a general audience and is able to provide insightful perspectives on a wide range of economic issues.