Swedish fashion giant H&M has returned to profitability in the first half of the year after enduring a bruising 2020 due to the coronavirus crisis.

For the period between December 1, 2020 and May 31, 2021, H&M reported profits after tax of SEK 1,697m, from a SEK 3,063m loss in the corresponding period last year. 

Group net sales for the period amounted to SEK 86,569m, up from SEK 83,612m the previous year, and H&M reported net sales in local currencies increased by 12% in the period. 

The fashion retailer said cash flow from operating activities amounted to SEK 20,219m for the period and reported that its online sales “have continued to develop very well, even as stores have been allowed to reopen”.

This strong first-half recovery was driven in particular by a strong second quarter, where the reopening of the giant’s vast international store estate pushed a 75% increase in net sales to SEK 46,509m. 

Gross profits for the group during the period also leapt 89% to SEK 25,049m, while ecommerce sales soared 40%. 

H&M said its customer-loyalty programme now has around 130 million members in 27 countries – an increase of some 50 million in 12 months. 

During the period, H&M opened via franchise in Qatar and launched on ecommerce platform Zalora in Indonesia, the Philippines, Malaysia and Singapore. 

It is set to add Cambodia to its international markets this year through franchise selling.

Group chief executive Helena Helmersson said: “As more and more people are vaccinated and restrictions are eased, the world is gradually opening up and customers can once again visit our stores. With the combination of much-appreciated collections, rapid adaptation and further improvements, our recovery is strong. 

“Despite continued restrictions, sales increased significantly compared with the previous year. The third quarter has started well and we are almost back at the level we were at before the pandemic.

“I am proud of all our colleagues’ commitment and drive during this challenging period. The crisis has made us even stronger as a company. The lessons we have learned are enabling us to be even better and faster at making the most of new opportunities, and we are optimistic about the future.”

“Both existing and new customers are showing every day that they appreciate our customer offering with the best combination of fashion, price, quality and sustainability. Our long-term digital investments and increasingly integrated sales channels, along with more efficient ways of working and our customer focus, have been important during the pandemic.

“By being flexible and adapting quickly, all parts of the company have contributed to the recovery. At the same time, we can never sit back and relax. We are driven by a passion to continually improve the customer offering and the customer experience.”

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