STOCKHOLM (AFP) – Swedish clothing giant H&M said yesterday it slumped to a near EUR500 million second quarter loss as the coronavirus pandemic forced it to close more outlets than planned.
At the height of the crisis in Europe in mid-April, about 80 per cent of its shops were shut. Net loss fell to about SEK5 billion (EUR477 million), H&M said.
“When the majority of the stores were temporarily closed in the second quarter, we focussed on redirecting product flow to our digital channels,” Chief Executive Helena Helmersson said in the quarterly report.
In the three months to May, sales overall tumbled 50 per cent compared with a year earlier to SEK28.7 billion but online sales rose 32 per cent. The company had been planning to open some 165 shops and close 130 this year but it said it now expects to shut 170 and open fewer, at 130.
Some 350 shops are currently closed, about seven per cent of the global total.
In its 2019 second quarter H&M posted a net profit of SEK4.6 billion, compared with a net loss of nearly SEK5 billion announced yesterday.
Earlier this year, H&M reported a strong start but warned that it expected a tough second quarter because of the coronavirus crisis.
“The second quarter will naturally be very negatively impacted by the corona situation and will therefore be loss-making,” the group said at the time.