H&M shares soar to 16-month high after beating forecasts
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Swedish clothing and accessories chain H&M reported sales of SEK 57.6 billion (€4.9 billion) in the second quarter (March-May) of fiscal year 2023, up 6% from a year earlier (.pdf). In the first half of fiscal year 2023, sales grew by 9%. The company also noted that overall physical store sales increased during the first half of the year, despite the fact that the number of these stores decreased by about 300 units.
About 30% of H&M sales came from the Internet. The company’s second-quarter net profit amounted to 3.29 billion crowns (€280 million), which, although 9% lower than a year earlier, is significantly higher forecasts analysts who expected a profit of only 2.84 billion crowns (€241 million).
They were also pleasantly surprised by the reduction in the company’s inventory in the second quarter – to 16.7% from 19.2% a year earlier. “I am very surprised to see such dynamics against the background of the fact that H&M has not stepped up its advertising and marketing campaigns during this period,” Cedric Rossi, an analyst at investment company Bryan Garnier, told CNBC.
After the publication of the financial statements, H&M shares soared in price by 15%, reaching the level of early February 2022.
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