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4th quarter net sales of SEK 52.5 billion (630 million), a decrease of 14.9% from SEK 61.7 billion in the same period in 2019.
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Net sales in the fourth quarter fell 10% in local currency terms.
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Net sales for the fiscal year were SEK 187 billion, a decrease of 19.7% from the previous SEK 232.8 billion.
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Net sales for the fiscal year fell 18% in local currency terms.
Until it was affected by the first wave of the COVID-19 epidemic, H&M Group maintained strong positive momentum at the beginning of 2020. Signs of improvement in H&M’s global sales performance in the third quarter were maintained until the last three months of last year. In local currency terms, sales fell only 3% from September 1 to October 21. However, the arrival of the second wave of the COVID-19 epidemic in Europe and subsequent city closures and restrictions on social activities resulted in a 22% drop in sales from October 22 to the end of November.
Although H&M’s performance in 2020 is expected to surpass many competitors in the apparel market, such as Primark and Marks&Spencer, its online channels have failed to compete with other multi-channel Retailers can offset the negative impact of store closures. H&M’s main competitor Inditex reported on December 15 last year that its net sales in the third quarter (August to October) fell by 13.5%, which was similar to H&M’s performance, but its online sales in the nine months as of October 31 Sales increased by 75%, exceeding market expectations and exceeding H&M’s 40% growth in the second quarter and 27% growth in the third quarter.
Although H&M has not yet released its sales results by country and region, the epidemic prompted the UK to announce measures to close stores for one month in the fourth quarter, and the United States Affected by the continued growth of infection cases and social and cross-regional restrictions, H&M’s sales in its two major markets, the UK and the United States, have continued to suffer a severe blow. Due to the significant impact of the new crown on the global economy, consumers are driven to reduce non-essential spending. Therefore, although consumer demand for clothing will remain at a low level at the beginning of this year, H&M’s price-oriented approach will keep its performance stable.
As most social distancing restrictions will continue to be implemented in the first half of this year, store traffic will still be suppressed, and the penetration rate of clothing online sales will remain high this year. level, including major markets such as the United Kingdom and the United States, with an estimated penetration rate of 30-40%. Therefore, it is increasingly important for H&M to reduce the size of too many stores.
H&M has paid the price for being late in developing its online business in the 2019/20 fiscal year, so it must quickly bring its online business to the same level as its competitors. To avoid this happening again this year.
