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H&M Q2 Profit Rises, Sees Weak Sales In June; To Buy Back SEK 3 Bln Shares

Swedish retailer Hennes & Mauritz AB or H&M Group (HNNMY.PK,HMRZF.PK,HEN.L) reported Wednesday that its second-quarter profit after tax increased to 3.68 billion Swedish kronor from last year's 2.77 billion kronor. Earnings per share were 2.22 kronor, up from 1.67 kronor a year ago.

Operating profit was 4.99 billion kronor, corresponding to an operating margin of 9.2 percent, higher than prior year's 3.85 billion kronor or 8.3 percent margin.

Net sales increased 17 percent to 54.50 billion kronor from 46.51 billion kronor last year. In local currencies, the increase was 12 percent. Excluding Russia, Belarus and Ukraine sales increased by 17 percent in local currencies.

Helena Helmersson, CEO, said, "The H&M group's sales increase in the quarter is a result of well-received collections with increased full-price sales and lower markdowns. With a well-positioned customer offering, combined with physical and digital sales channels that strengthen each other, we are fully focused on meeting customers' ever-increasing expectations of affordable and sustainable fashion."

Further, the company said its board of directors has decided to buy back own B shares for 3 billion kronor starting from June 29.

Looking ahead, sales in the month of June 2022 is expected to decrease by 6 percent in local currencies compared with June 2021. The paused sales in Russia, Belarus and Ukraine represent 5 percentage points of the decrease. In June 2021, sales grew 24 percent, while July and August increased by 6 percent.

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