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H&M sees 3rd straight monthly fall in sales
Source: Agencies |
December 16, 2011, Friday
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SWEDISH fashion group Hennez & Mauritz posted a third straight monthly fall in sales at established stores in November as economic woes and unusually warm autumn weather across its main markets kept customers away from the shops.
With the eurozone deep in a debt crisis and global economic growth looking sluggish, consumers have held back on spending instead of splurging on new fashion items. Meanwhile, unseasonable temperatures have limited the demand for winter wear.
In November, sales at comparable H&M stores - open for a year or more - fell 1 percent, missing a mean forecast for a 0.4 percent rise in a Reuters poll of analysts. Forecasts ranged between minus 4 and plus 4 percent.
"It indicates that they are growing roughly in line with the market. It seems quite reasonable, but we had expected they would grow slightly faster," said Christian Anderson, an analyst at Swedbank.
Total turnover at the world's second biggest apparel retailer, which recently launched a collection by Italian fashion icon Donatella Versace, rose 9 percent in local currencies in November, missing the poll average of a 10.2 percent rise.
"I was a bit disappointed this morning. We saw Inditex's third quarter yesterday, and they managed to increase both sales and earnings more than H&M," said Nicolaj Jeppesen, an analyst at Sydbank.
Sales at H&M rival Inditex eased in its fiscal third quarter but returned to normal growth in the first six weeks of the fourth quarter, starting November 1, the owner of the Zara brand said on Wednesday.
"To me it's quite surprising since we know that H&M are doing some heavy discounting and a lot of campaign work. We got the impression that Inditex didn't discount as much," Jeppesen said.
Sales in comparable stores at H&M have fallen for the past six months with the exception of August, when they were flat, reflecting weaker consumer confidence globally.
United States retail sales grew at their slowest pace in five months in November, tempering expectations for a strong Christmas shopping season. In the euro area, October retail sales rose slightly on the month, but economists said future prospects were poor.
H&M, with almost 2,500 stores in 43 countries, is often seen as better positioned to cope with a downturn than many others, thanks to its geographic spread and focus on catwalk fashion at low prices.
With the eurozone deep in a debt crisis and global economic growth looking sluggish, consumers have held back on spending instead of splurging on new fashion items. Meanwhile, unseasonable temperatures have limited the demand for winter wear.
In November, sales at comparable H&M stores - open for a year or more - fell 1 percent, missing a mean forecast for a 0.4 percent rise in a Reuters poll of analysts. Forecasts ranged between minus 4 and plus 4 percent.
"It indicates that they are growing roughly in line with the market. It seems quite reasonable, but we had expected they would grow slightly faster," said Christian Anderson, an analyst at Swedbank.
Total turnover at the world's second biggest apparel retailer, which recently launched a collection by Italian fashion icon Donatella Versace, rose 9 percent in local currencies in November, missing the poll average of a 10.2 percent rise.
"I was a bit disappointed this morning. We saw Inditex's third quarter yesterday, and they managed to increase both sales and earnings more than H&M," said Nicolaj Jeppesen, an analyst at Sydbank.
Sales at H&M rival Inditex eased in its fiscal third quarter but returned to normal growth in the first six weeks of the fourth quarter, starting November 1, the owner of the Zara brand said on Wednesday.
"To me it's quite surprising since we know that H&M are doing some heavy discounting and a lot of campaign work. We got the impression that Inditex didn't discount as much," Jeppesen said.
Sales in comparable stores at H&M have fallen for the past six months with the exception of August, when they were flat, reflecting weaker consumer confidence globally.
United States retail sales grew at their slowest pace in five months in November, tempering expectations for a strong Christmas shopping season. In the euro area, October retail sales rose slightly on the month, but economists said future prospects were poor.
H&M, with almost 2,500 stores in 43 countries, is often seen as better positioned to cope with a downturn than many others, thanks to its geographic spread and focus on catwalk fashion at low prices.
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