Food
Hennes & Mauritz released stronger-than-expected fourth-quarter results on Friday but flagged ongoing challenges in trading conditions, with more than 1,000 stores temporarily closed.
“The ongoing restrictions along with the many temporary store closures will have a substantial negative impact on the first quarter,” said chief executive officer Helena Helmersson, speaking on a phone call with analysts to discuss the company’s full-year performance.
The company said 36 percent of its sprawling retail network is temporarily closed, or 1,800 stores. Sales in the Dec. 1 to Jan. 27 period were down 23 percent in local currencies compared with the same period last year.
The company posted a profit of 2.48 billion Swedish kronor, or $300 million, in the fourth quarter, from Sept. 1 to Nov. 30, and executives touted a strong financial position at the end of the year.
“With strong, profitable online growth and good cost control we succeeded in ending the year in profit and with a strong financial position,” Helmersson said.
Analysts said fourth-quarter results were better than expected thanks to lower operational expenditure than forecast but noted the sales update was weaker than expected.
“Recent trading is in line with our fairly cautious estimate,” said Richard Chamberlain of RBC, noting the outlook was “tough.”
