H&M shares rise nearly seven per cent as profits surge
Hennes & Mauritz have seen their shares rise by nearly seven per cent after the company saw net income grow to £428m during the three months ending August 31.
Gross margins for the company have increased 58.8 per cent of sales as compared to the previous year 58.2 per cent. This recent success will come as good news to the company which had missed its earnings targets for nine of the last twelve quarters.
Commenting on the strong growth seen in the third quarter with a sales increase of 11 per cent CEO Karl-Johnan Persson commented:
Our well received summer collections have resulted in strong sales development in the quarter, particularly in Asia but also in a number of European markets. We have also seen the very successful launch of our online store in the US in August and can see that our offering stands up well in the world’s largest online market.
H&M is also confident about it's continued expansion into new regions.
Our expansion is strong. It is not long since we opened our 2,000th store in 2010, and this September – only three years later – we opened our store number 3,000 in Chengdu, one of China’s major cities. China is the country where our expansion is strongest, but we are also expanding in other exciting regions. We have opened 215 new stores so far this year and have had successful openings in four new H&M countries: Chile, Lithuania, Serbia and Estonia. In October this year we will open in another country in Southeast Asia – in Indonesia via franchise – and in the first half of 2014 we will open our first store in Melbourne, Australia. In 2015 we plan to open in South Africa.
After starting an online store in the US the retailer intends to add new e-commerce markets over the coming two years.