Growth of H&M sales in 2016 – Mark-downs and strengthened dollar reduce profit to EUR 1.97 billion
Gross profit increased to SEK 106.177 billion (around EUR 11.23 billion).
The group’s profit after tax amounted to SEK 18.636 billion (around EUR 1.972 billion), compared to SEK 20.898 billion (around EUR 2.21 billion) in 2015. Profits during the year were negatively affected by increased mark-downs but also by higher purchasing costs from the strengthened US dollar, the company's report says.
The group achieved a very strong expansion during the year with a total net addition of 427 new stores and 11 new H&M online markets. At the end of the financial year H&M had 35 online markets and the number of stores amounted to 4,351 in 64 markets, of which 35 online stores.
Furthermore, 13,000 new jobs were created in the H&M group in 2016 and the number of employees thereby amounted to more than 161,000 at the end of the financial year, the report says.
– 2016 was an eventful year which included many positive things but also challenges for us as well as for the industry. During the year, we opened 427 new stores net worldwide and added three new markets, and we also rolled out our online store to 11 additional markets. This means that H&M is now present in 64 markets of which 35 offer e-commerce – said Karl-Johan Persson, CEO of H&M Group.
– The year was characterized by the shift in the industry towards an ever growing online market and by digitalization. We are very pleased that our online business developed very well for all our brands, both as regards sales and profitability. From an already high level we took further market share, which clearly proves that our investments in our online business have been successful. Our brands COS, & Other Stories, Monki, Weekday and H&M Home had apart from strong online sales growth also very good store sales – said Karl-Johan Persson.
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