Swedish apparel retailer Hennes & Mauritz AB or H&M (HEN.L, HMRZF.PK, HNNMY.PK) posted a decline in first-quarter 2013 profit after tax to 2.46 billion Swedish Kronor, or 1.49 kronor per share, from 2.74 billion kronor, or 1.65 kronor per share, a year before. Quarterly profit after financial items stood at 3.23 billion kronor, down from 3.7 billion kronor in the earlier year quarter. The Group said profits were hurt by large long-term investments but also by substantial negative currency translation effects.
The H&M Group's sales, including VAT, rose by 6 percent in local currencies in the first quarter. Sales in the quarter have been negatively affected by calendar effects by slightly more than 2 percentage points. Converted into SEK, sales before VAT totaled 28.39 billion kronor, up 2 percent from last year's 27.83 billion kronor. The difference in sales performance in local currencies versus SEK is explained by substantial negative currency translation effects as a result of the continued strengthening of the Swedish krona against most sales countries' currencies, according to the company.
The company added that Chile, Estonia, Lithuania, Serbia and, through franchise, Indonesia would become new H&M markets in 2013, whereas Australia would become its new market in 2014. Further, H&M's updated and extended sports concept for women, men and children would be launched at the beginning of 2014.
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