By Dominic Chopping
STOCKHOLM--Sweden's Hennes & Mauritz AB on Thursday posted a forecast-beating rise in second-quarter net profit after experiencing a strong recovery from the pandemic amid well-received collections and easing restrictions.
"The third quarter have started well and we are almost back at the level we were at before the pandemic," said Chief Executive Helena Helmersson.
The company posted a net profit of 2.77 billion Swedish kronor ($324 million) for the fiscal quarter ended May 31, compared with a loss of SEK4.99 billion a year earlier. Analysts polled by FactSet had expected a profit of SEK2.66 billion.
Sales rose 62% to SEK46.51 billion, as previously announced, while net sales between June 1 and 28 increased by 25% in local currencies on the year. Compared with the same period in 2019, sales decreased by around 4%.
Sales are still being adversely affected by reduced footfall in physical stores due to continued restrictions and store closures, it added. Presently, around 95 stores remain temporarily closed, from a total of 4,913.
The fashion retailer previously cautioned of challenges in China after facing a backlash from its decision not to source products from Xinjiang on ethical grounds. Its earnings report Thursday showed that second-quarter sales in the country fell 28% on the year to SEK1.62 billion.
The company reiterated that it expects there will be very good prospects of a dividend in the autumn.
Write to Dominic Chopping at firstname.lastname@example.org
(END) Dow Jones Newswires
July 01, 2021 02:52 ET (06:52 GMT)Copyright (c) 2021 Dow Jones & Company, Inc.