Ekonomania

H&M, sales performance 2017

it is time to change

0

The H&M group reaches fashion fans across the globe and has come a long way since the first Hennes store opened in the Swedish city Västerås in 1947. After 70 years , Group brings fashion to the world in an exciting and conscious way. Today H&M Group has 8 brands, 161,000 employees in 4,553 (2017 Aug) stores.

According to Nine months (1 December 2016 – 31 August 2017) financial reports;

SEK (swedish krone)=0,1221 USD

The H&M group’s sales including VAT increased by 7 percent to SEK 173,290 m (161,767) during the first nine months of the financial year. Sales excluding VAT amounted to          (18,2b USD)SEK 149,597 m (139,547), an increase of 7 percent. In local currencies sales increased by 4 percent.

Profit after financial items amounted to SEK 15,936 m (16,630). The group’s profit after tax amounted to (1,48b USD) SEK 12,191 m (12,722), corresponding to SEK 7.37 (7.69) per share.

Important point is decreasing sales in Germany that is biggest market.Group losing sales in Netherlands hightest rate in local currency. Comments by Karl-Johan Persson, CEO;
“The fashion retail sector is growing and is in a period of extensive and rapid change as a
result of ongoing digitalization. The competitive landscape is being redrawn, new players
are coming in and customers’ behavior and expectations are changing, with an ever
greater share of sales taking place online”

It looks sales growth is getting slower.

Slowing sales growth effect to profit of company as well.

Let’s have a look  9 months like for like for 5 years changes below;

The H&M group and Alibaba group extend their co-operation.

H&M opens on Tmall, the world’s largest e-commerce platform, during spring 2018. Group have been in mainland China  for 10 years. Today H&M group revenues in China amount to approximately USD 1.3 billion in more than 500 physical stores and online. The H&M group brand Monki has had a strong development in China since its launch on Tmall and the collaboration between the two groups is now being extended to include both the H&M brand and H&M Home. There are also far advanced discussions regarding the launch of the remaining brands in the H&M group on Tmall.

“As one of the world’s most innovative fashion companies, H&M is a perfect fit for Alibaba’s Tmall platform,” says Michael Evans, President of Alibaba Group. “We are honored to expand our cooperation with H&M and host their flagship store, enabling H&M brands to engage with our half a billion consumers.”

“We are very happy to be able to make H&M even more accessible in mainland China. Tmall is an important complement to our existing physical and digital stores. We see great potential for substantial future growth and Tmall will be an important part of this,” says Karl-Johan Persson, CEO of the H&M group.

Competition is going up in future.We will see H&M Group how to catch Inditex Group.