the profit of The Swedish fashion group Hennes & Mauritz (H&M) declined in the fourth quarter of 2018. The operating result fell to a notification, according to year-on-year by around ten percent to 4.3 billion Swedish crowns (EUR 414 million). Basic price discounts on in-stock products.

“This has been a challenging year for the industry as a whole and also for the H&M group,” said CEO Karl-Johan Persson. In the first eleven months the Surplus fell, declining by more than a fifth of the equivalent of 1.2 billion euros. The dividend is to remain unchanged at around 0.9 Euro per share.

The textile chain, including the up-market label COS, & Other Stories, as well as service industry, suffered in the past few years, a decline in profits and a increase in stocks, since the sales of the core brand shrank. After a difficult first half of the year, there are signs that the company’s transformation to show the effect, as Persson. Improved collections have contributed to the end of the year less discount actions had been necessary, than before.

H&M is fighting with tough competition in the online trade

H&M had recently switched over its logistics systems. “Inevitably, the higher costs led, but it will lead to a series of improvements for customers,” said Persson. In the fourth quarter of three new logistics centres with a total area of 230,000 square were opened meters, including two Arrived in Poland and one in North Rhine-Westphalia. H&M wants to offer customers faster delivery times and a wider range, especially in the online trade.

descent of the fashion group, The error of the H&M heir

With the equivalent of EUR 5.5 billion were the revenues in the fourth quarter, approximately twelve percent above the level a year earlier. In the full year, they grew by five per cent to around 20.3 billion euros. The largest market remains Germany, followed by the USA and the UK.

The H&M group is currently aimed. He has been relatively late in responding to the competition from online retailers, or from cheaper suppliers such as Primark. 2019 H&M wants to open 175 new stores. The sales on the Internet have developed during the past year, already had a positive effect and increased year on year by 22 percent to an estimated 2.9 billion euros. This corresponds to a proportion of the total sales of the group in the amount of 14.5 percent; in 2017, there were still 12.5 per cent.

kko/dpa/Reuters