H&M has posted a larger-than-expected first quarter operating profit as it remains “fully focused on driving profitable growth”.
The Swedish fashion group reported its operating profit had nearly tripled to £155m (SEK 2.1bn), up from £51m (SEK 725m), in the three months to 29 February.
During the quarter, the retailer widened its profit margin to 3.9%, compared with a previous 1.3%, as it targets a 10% operating margin for the full year.
Sales slipped 2% to £4bn (SEK 53.7bn), however, the retailer said performance had “gradually improved” during February with “well-received” Spring collections. IT also said sales for the three weeks to 25 March had edged up 2% in local currencies.
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Recently appointed chief executive Daniel Ervér said: “We are fully focused on driving profitable growth going forward. Our stronger gross margin enables us to enhance the customer offering further and provide more value for money through improved quality and better prices.
“We are strengthening all parts of our assortment and our design organisation’s most important mission is to create attractive collections.
“We continue to plan our business with respect for a challenging situation in the world around us where consumers remain affected by inflation and high interest rates. In this situation our customer offering is more relevant than ever.”
“Our top priority is to strengthen sales, and our target of a 10% operating margin for full-year 2024 thus remains in place.”
Ervér pledged last month that H&M will invest more in reacting quicker to new trends in a bid to rival its fast fashion rivals and grow revenue.
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