Group sales excluding VAT at Swedish based retailer H&M increased 15 per cent in local currencies in its full-year period, according to results published today.
Profits after financial items between December 1st 2009 and November 30th 2010 totalled SEK 25.008 billion (£2.4 billion), a growth of 13 per cent year-on-year.
Group sales rose 15 per cent in the company’s fourth quarter but profits were down ten per cent, reflecting the difficult end of the year many fashion retailers faced as margins were squeezed.
Karl-John Persson, CEO of H&M, said: “2010 was a very good year for H&M with a sales increase of 15 per cent. During the year we improved our market position further with a strengthened customer offering by giving the customers even more fashion and quality at the best price.
“The economy improved from 2009 but in several countries the economic situation was still uncertain and difficult.
“In the fourth quarter, sales increased by a satisfactory 15 per cent. The operating margin, of approximately 24 per cent, continued to be at a high level. Excluding currency translation effects, profit after financial items was in line with the previous year.”
A strong start to the new year saw sales for the period of January 1st - 25th increase by nine per cent and the group plans to add a further 250 stores to its portfolio worldwide in the 2010/2011 financial year.
H&M launched a transactional site in the UK in 2010, which the group plans to update shortly, and a US version will also go live at the end of this calendar year.
The retailer’s link ups with cutting-edge fashion designers and labels continued this month when it signed a deal to sell discounted Hasbeen clogs and in September it signed a similar deal with French couture house Lanvin.
Persson continued: “External factors change in the markets of production. Raw material prices have increased; cotton prices for example almost doubled in 2010.
“Naturally, H&M has to adapt to changing conditions but always in a way that is in accordance with our business concept - to offer customers fashion and quality at the best price - and in that way increase the opportunities for us to continue to take market shares.
“We are optimistic about the future and we plan to increase sales in comparable units in 2011.”