Belfast Telegraph

H&M shares plunge as sales suffer from online shopping shift

Shares in the group sank more than 12% on the Stockholm Stock Exchange.

Shares in Hennes & Mauritz (H&M) have plunged after the retailer moved to close stores following a customer shift towards online shopping and lacklustre trading in the fourth quarter.

The Swedish fashion retailer said sales excluding VAT slipped 4% to 50.4 billion Swedish krona (£4.5 billion) in three months to November, compared to last year, coming in “significantly below” expectations.

While online sales “continued to develop well”, it said bricks and mortar shops took a hit as more people opted to buy clothes and products online.

Shares in the group sank more than 12% on the Stockholm Stock Exchange.

Chief executive Karl-Johan Persson said: “In order to respond even quicker to customers’ fast-changing behaviour the company’s ongoing transformation journey is being accelerated.

“Among other things, this includes continued integration of the physical and digital stores, and intensifying the optimisation of the H&M brand’s store portfolio, leading to more store closures and fewer openings.”

On an annual basis, sales excluding VAT grew 3% to 199.9 billion Swedish krona (£17.7 billion) for the financial year.

H&M, which owns the COS and Cheap Monday brands, opened 24 UK stores and closed 13 leaving it with a total of 292 for 2017. Across the globe, the retailer has 4,739 stores.

The update comes after UK retail sales remained stronger than expected last month as businesses reported a Black Friday sales boost.

Sales in November were up 1.6% on the same time last year despite rising inflation and stagnant wage growth, the Office for National Statistics (ONS) figures show.