H&M reported its financial results surprising the analysts and even the brand
It indicated that its income amounted to around $ 229 million.
Its results raise optimism in the retail sector that has suffered the crisis
Retail has suffered a lot this year, as a result of a combination of factors such as the COVID-19 emergency and a long process that has gone through adapting to consumer needs and habits. However, it seems that it shows signs of new vitality, at least the month apparel brands like H&M show strength.
The above after the company of Swedish origin presented its financial report in which it surprised by obtaining income well above the anticipations of the analysts.
The brand numbers
H&M happened to say Tuesday it posted revenue of about $ 229 million, before taxes, for the June-August quarter (its third of the year).
This is well above that projected by analysts, in fact almost 10 times more, as it had been estimated $ 21.8 million, according to Refinitiv’s SmartEstimate model, cited in a Business Insider report.
Results that surprised even the interior of H&M where it stands out how the recovery of the economy and the reopening of stores have positively magnetized sales.
“The development of sales in the third quarter reflects the situation of Covid-19. At the beginning of the quarter, approximately 900 of the group’s more than 5,000 stores were temporarily closed. At the end of the quarter, just over 200 stores closed temporarily. (…) As a result of an appreciated collection together with quick and decisive actions, the recovery of the H&M group is better than expected. More full-price sales, combined with strong cost control, enabled the company to turn a profit in the third quarter, ”notes the Stockholm-based firm.
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Keys that the sector lives
Undoubtedly, H & M’s results are due to a sum of factors that we are increasingly noticing as businesses enter the so-called ‘new normal’, something that, added to the momentum of digital channels, is allowing brands to resurface .
An example of this is what Gap Inc. recently reported, as the San Francisco firm indicated that its sales as of August 1 reached 3.28 billion dollars. While it was 18 percent down from a year earlier, it certainly beat analysts’ expectations who expected sales of about $ 2.910 billion.
The situation awakens good spirits in the sector and in the investment markets as it is expected that this week, Inditex, the Spanish group that owns Zara and other brands, will also present its financial results.
All this is relevant, especially considering that the retail industry is estimated to fall 3 percent during 2020, equivalent to approximately 549 billion dollars, according to a recent report by GlobalData.