Fashion Retailer H&M Clocks 10% Top-Line Growth In Q4; Notes Challenging External Factors

Swedish clothing giant Hennes & Mauritz AB HNNMY reported a 10% year-on-year increase in fourth-quarter FY22 sales to SEK 62.4 billion.
The results were impacted by a one-time cost of SEK 836 million for the cost and efficiency program. Gross profit amounted to SEK 31.01 billion with a gross margin of 49.7%.
Operating profit amounted to SEK 821 million and the operating margin was 1.3%. The company attributed the lower profit in the fourth quarter to negative external factors, loss of the operating profit previously contributed by Russia, and the one-time cost of the cost and efficiency program.
The board of directors is proposing an ordinary dividend of SEK 6.50 per share to the annual general meeting to be paid in two installments.
For FY2022, the company saw a 12% rise in sales to SEK 223 billion. Operating profit was SEK 7.2 billion with a margin of 3.2%.
"Our decision to wind down the business in Russia, which was an important and profitable market, has had a significant negative impact on our results," said CEO Helena Helmersson.
"The hikes in raw materials and freight costs combined with a historically strong US dollar resulted in extensive cost increases for purchases of goods."
H&M group's sales increased by 5% in local currencies in the period Dec 1, 2022 – Jan 25, 2023.
Price Action: HNNMY shares closed higher by 2.61% at $2.52 on Thursday.
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