Nimbler H&M sees profits rise in third quarter

H&M group has 180 fewer stores across its nine brands than it did last year. When the increase is converted into Swedish krona, net sales decreased by 3% to hit SEK 57bn (£4.5bn) due to a stronger krona.

Operating profit meanwhile increased by 40% on Q3 2024, which H&M attributed to a stronger customer offering, improved gross margin and cost control.

Gross profit was up slightly on Q3 2024, with gross margins increasing to 52.9% from 51.1%. However, the brand warned that the external factors driving improved margins were likely to be less positive as “tariff costs are expected to have an increased impact.”

“In an environment of ongoing uncertainty with cautious consumers, all of us within the H&M group are consistently focusing on our customer offering – always giving the best value for money,” said chief executive Daniel Ervér

It said that sales in September were likely to be flat year over year, pointing to a strong trading month in September 2024.

In local currencies, H&M saw 3% sales growth in all European regions excluding the Nordics where sales were flat year over year. Sales in its Asia, Oceania and Africa region were down by 2% in local currency.

Highlights for the quarter included the brand launching in Brazil in August. “We see good potential to grow both in Brazil and elsewhere in Latin America,” said Ervér.