Retail & Brands


H&M increases results in the past financial year

In the annual report for the past financial year (December 1, 2022 - November 30, 2023), the H&M Group delivered increased figures in all areas. “Operating profit has been positively impacted by a stronger gross margin, the cost and efficiency programme, and good cost control. The H&M group is taking important steps towards the company’s ambitious climate goals. Preliminary results indicate that greenhouse gas emissions decreased by more than 20 percent in 2023 compared with the 2019 baseline*,” says Helena Helmersson, CEO.

The H&M Group's net sales in SEK increased by 6 percent to SEK 236,035 million (223,553) in the 2023 financial year. Sales for the portfolio brands rose by 15 percent in SEK and 9 percent in local currencies during the financial year.

Gross profit increased by 7 percent to SEK 120,896 million (113,370). This corresponds to a gross margin of 51.2 percent (50.7). Operating profit, including the allocation to the H&M Incentive Program (HIP), increased to SEK 14,537 M (7,169), which corresponds to an operating margin of 6.2 percent (3.2). Operating profit amounted to SEK 14,714 M (7,169) excluding the allocation to the HIP. This corresponds to an operating margin of 6.2 percent (3.2). Earnings after tax increased by 145 percent to SEK 8,723 M (3,566), which corresponds to SEK 5.35 (2.16) per share. Cash flow from operating activities increased by 37 percent to SEK 33,949 million (24,745).

Financial net cash amounted to SEK 9,316 m (10,929). Cash and cash equivalents plus undrawn credit facilities were SEK 44,570 m (39,176).

The year’s increase in profit means that SEK 177 m (0) has been allocated to HIP, which is for all employees.

Fourth quarter (1 September 2023 – 30 November 2023)

The H&M group’s net sales amounted to SEK 62,650 m (62,433). Excluding Russia and Belarus the increase was 3 percent in SEK and decreased by 1 percent in local currencies. Gross profit increased by 8 percent to SEK 33,657 m (31,104). This corresponds to a gross margin of 53.7 percent (49.8). Operating profit amounted to SEK 4,509 m (821), excluding allocation to HIP. This corresponds to an operating margin of 7.2 percent (1.3). Operating profit including allocation to HIP increased to SEK 4,332 m (821). This corresponds to an operating margin of 6.9 percent (1.3). The result after tax increased to SEK 1,576 m (-864), corresponding to SEK 0.97 (-0.53) per share. Currency adjusted the stock-in-trade decreased by 13 percent compared with the previous year. Converted into Swedish kronor the stock-in-trade decreased by 12 percent to SEK 37,358 m (42,495). In the fourth quarter cash flow from operating activities improved by 41 percent to SEK 9,207 m (6,524).

The H&M group’s sales decreased by 4 percent in local currencies in the period 1 December 2023 – 29 January 2024 compared with the same period the previous year.

CapEx in comparable currency is planned to amount to SEK 11-12 billion (9,0) for 2024, corresponding to an increase of up to around 30 percent compared with 2023.

The board of directors is proposing to the 2024 annual general meeting that an unchanged ordinary dividend of SEK 6.50 per share is paid in two instalments.

The board of directors will also ask the annual general meeting for a general authorisation allowing the board to choose to buy back the group’s own B shares.

*Refers to science-based targets for own operations (scope 1 & 2) and for the company’s entire value chain (scope 3), and excludes the use of sold products.

Solar panels at H&Ms Head Office, Stockholm © H&M
Solar panels at H&Ms Head Office, Stockholm © H&M

Helena Helmersson, CEO H&M © H&M
Helena Helmersson, CEO H&M © H&M

Comments by Helena Helmersson, CEO

"In 2023 we took important steps towards our long-term goals. Our improvement work in the supply chain and continued normalisation of the external factors that influence purchasing costs resulted in a stronger gross margin. A focus on cost control, profitability and increased inventory productivity also contributed to improved cash flow that is financing increased reinvestments in the business. For many consumers the year was marked by lower purchasing power because of high inflation and high interest rates. Despite this, our net sales in comparable markets increased in relation to 2022. The fourth quarter started with unusually hot weather in several of our important European markets. From mid-October sales recovered as more normal autumn weather returned, with well-received collections.

The H&M group’s brands are well positioned for continued growth, and we are making progress in all our growth areas:

H&M. Our top priority is H&M, where our focus is on further enhancing the customer experience and the customer offering. Our customers are gaining access to a broader and more relevant assortment in stores and online thanks to our investments in areas such as tech and AI, which support our continued work on greater precision and shorter response times. Simultaneously we are continuing to integrate the two channels for a convenient customer experience with better product availability. In 2024 we are stepping up the pace of investment in our existing stores to provide an even more inspiring experience, while at the same time securing our store portfolio for continued profitability and growth.

Portfolio brands – COS, Monki, Weekday, & Other Stories and Arket – continue to develop well. Sales at COS, Arket and Weekday have developed particularly strongly over the year, and these brands are contributing more and more to the group’s profitability development.

New growth and ventures. We are creating new revenue streams through a variety of strategic partnerships and new circular business models, and we see great potential in the companies that we invest in. One example is Sellpy, which is growing rapidly in 24 European markets as demand for second-hand fashion continues to increase. Our investments in innovation also mean we are taking important steps on our journey towards circularity. Through greater use of recycled and more sustainably produced materials we are moving closer to our long-term sustainability goals.

Our climate goals are set high, and preliminary results show that we reduced greenhouse gas emissions by more than 20 percent compared with our 2019 baseline*. This takes us even closer to our science-based targets, which are some of the most ambitious in our industry.

The H&M group stands strong with a robust financial position, strong cash flow and improved profitability. With our continued customer focus, committed colleagues and faster pace of investment we see good conditions for continued profitable and sustainable growth in 2024."

* For own operations (scope 1 & 2) and for the rest of our value chain (scope 3) and excluding use of sold products.

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