H&M: Q1 better than expected
(CercleFinance.com) - On Wednesday Hennes & Mauritz reported a smaller-than-expected loss for its first fiscal quarter, although this performance does not seem to fully reassure investors.
The company's net loss for the first three months of FY 2020-2021 (to 28 February) came to 1.4 billion Swedish kronor (about 140 million euros), compared with a net profit of 2.5 billion Swedish kronor a year ago.
Analysts were expecting a greater loss of around 1.5 billion Swedish kronor.
Sales fell 21% in local currencies - to 40 billion Swedish kronor (about 4 billion euros) - a decline the Swedish clothing chain blames on the second wave of the pandemic, which closed 36% of its shops at the height of the winter.
Even so, H&M, the world's number two clothing retailer behind Spain's Inditex, said sales in March jumped 55%.
However, analysts fear that the arrival of the third wave of Covid will make this rebound just fleeting.
The problem is that 1,500 outlets are now closed, compared to about 900 as of 13 March, which will weigh on April's sales, RBC analysts warn.
They calculate that 30% of the group's shops are currently closed.
The H&M share is down over 2.5% on Wednesday morning.
Copyright (c) 2021 CercleFinance.com. All rights reserved.
The company's net loss for the first three months of FY 2020-2021 (to 28 February) came to 1.4 billion Swedish kronor (about 140 million euros), compared with a net profit of 2.5 billion Swedish kronor a year ago.
Analysts were expecting a greater loss of around 1.5 billion Swedish kronor.
Sales fell 21% in local currencies - to 40 billion Swedish kronor (about 4 billion euros) - a decline the Swedish clothing chain blames on the second wave of the pandemic, which closed 36% of its shops at the height of the winter.
Even so, H&M, the world's number two clothing retailer behind Spain's Inditex, said sales in March jumped 55%.
However, analysts fear that the arrival of the third wave of Covid will make this rebound just fleeting.
The problem is that 1,500 outlets are now closed, compared to about 900 as of 13 March, which will weigh on April's sales, RBC analysts warn.
They calculate that 30% of the group's shops are currently closed.
The H&M share is down over 2.5% on Wednesday morning.
Copyright (c) 2021 CercleFinance.com. All rights reserved.