Sweden 1, Spain nil

26 March 2003

Like Inditex, the Swedish retailer’s sales were up less than expected. But the good news is that H&M managed to boost margins.

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Hennes & Mauritz said that turnover including VAT rose 12% in the first quarter to SEK 12.64bn. The Swedish retailer also said that its sales only grew by 10% in February – on constant exchange rates compared to 16% and 18% growth in December and January respectively.

The group's gross margin rose 150bp to 54.4% thanks to improved stock management. H&M said that the lower level of stock in shops led to lower price reductions.

Operating profit grew by 41% to SEK15.6bn. Operating margin rose to 14.5% from 11.5% in the previous year. Excluding startup costs, the operating margin was 14.8%.

H&M said earnings rose 43% to SEK1.1bn.

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