Bloomberg News

H&M November Sales Miss Estimates as Weather Curbs Shopping

December 15, 2011

(Updates with shares in fourth paragraph.)

Dec. 15 (Bloomberg) -- Hennes & Mauritz AB, the world’s second-largest clothing retailer, reported monthly sales that missed estimates as shoppers delayed purchases of coats and sweaters amid mild winter weather.

Revenue at stores open at least a year slipped 1 percent, Stockholm-based H&M said in a statement today. Same-store sales were predicted to advance 0.3 percent, according to an SME Direkt poll of analysts. Total sales last month rose 9 percent, compared with estimates for growth of 9.9 percent.

Retailers including the U.K.’s Next Plc have said warmer- than-average temperatures in recent months affected sales. H&M’s larger competitor, Inditex SA yesterday reported its slowest quarterly sales growth in two years in the third quarter.

H&M fell as much as 1.4 percent in Stockholm trading and were unchanged at 210 kronor as of 9:32 a.m. The shares have fallen 6.2 percent this year, compared with a 13 percent rise for Inditex in Madrid.

H&M’s collaboration with Italian fashion house Gianni Versace SpA that started on Nov. 17 failed to offset the impact of the warmer weather. The prospect of falling household spending is also restraining retail sales amid higher taxes and increased unemployment in Europe.

“It’s pretty poor given that Germany was positive in the month and they were certainly promoting quite hard in the U.K.,” Simon Irwin, an analyst at Liberum Capital in London, said by e-mail. “The problem with promotions is that everyone is doing it. It doesn’t bode well for first quarter clearance.”

Comparable sales decreased 3 percent in the three months ended Nov. 30, H&M said, while total sales advanced 6 percent. The retailer had 2,472 stores as of Nov. 30, up from 2,206 a year earlier, the company also said.

--Editor: Paul Jarvis, Jerrold Colten.

To contact the reporter on this story: Armorel Kenna in Milan at akenna@bloomberg.net

To contact the editor responsible for this story: Paul Jarvis at pjarvis@bloomberg.net.


The Good Business Issue
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus