H&M, the Swedish fashion giant, has again missed City profit expectations,
blaming the heatwave in Europe and adverse foreign currency movements. The
discount clothing chain also said it would delay its online launch in the U.S. until next year, but vowed to step up its breakneck expansion with up to 300 new shops worldwide this financial year.
But the group, which has 2,629 stores globally, said the strengthening of the krona against the euro had wiped 200 million kronor (pounds sterling 18.7 million) from its profits for the quarter to Aug. 31, although its gross margins also fell.
Chief executive Karl-Johan Persson said: "Conditions in the fashion retail industry continued to be challenging in many markets -- both as regards the weather and macro-economic climate."
H&M grew pre-tax profits by 1 percent to 4.9 billion kronor in its third quarter, which missed consensus forecasts by 8 percent. Caroline Gulliver, analyst at Espirito Santo, said: "September sales growth has also fallen short of expectations and whilst there is some good news about an acceleration of new store openings, this is offset by yet another delay in the launch of H&M online in the U.S."
H&M plans to accelerate its opening of new stores from 275 to 300 this year, citing US and China as the biggest areas of growth.
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