H &M has released its nine-month financial report this morning, posting a drop in pre-tax profits of 17 per cent.
The fast fashion retailer raked in £1.4 billion for the nine months to August 31.
Its profit decline has been attributed to increased discounting and the strength of the dollar.
Despite the fall in profits the retailer posted a seven per cent increase in sales during the period. It said sales this month were expected to rise by one per cent compared with last September as warm weather “delayed” the launch of the season.
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This year H&M opened 425 new stores, entering new marketplaces across the globe including Cyprus and Puerto Rico, and planned to launch two new brands next year.
It also has extensive plans to continue expansion in New Zealand, Columbia, Kazakhstan and Iceland, as well as online launches in Canada and South Korea.
Upon completion this will bring the its total worldwide markets to 35.
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“Sales were good in most of the markets up until mid-August. Thereafter sales were negatively affected by unseasonably hot weather, which continued into September, resulting in a challenging start to the autumn season,” chief executive Karl-Johan Persson said.
“The sales performance in the third quarter and increased mark-downs as a result of a higher opening stock than planned had a negative impact on profit development.
“In addition, profits continued to be negatively affected by the strong US dollar effect on purchasing costs.”
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