H&M Extends Run of Fourth-Quarter Profit Declines on Discounting

Hennes & Mauritz AB (HMB), Europe’s second-largest clothing retailer, reported a third straight drop in fourth-quarter profit after the company stepped up discounting in an effort to pull in more shoppers.

Net income slid 1.3 percent to 5.29 billion kronor ($83 million) in the three months ended Nov. 30, Stockholm-based H&M said in a statement today. That topped the 5.20 billion-kronor average estimate of 16 analysts compiled by Bloomberg.

The profit drop halts a revival at the fashion retailer, which had reported earnings growth in each of the last three quarters after five consecutive declines. H&M makes most of its revenue from the euro-area, where governments are cutting spending and the jobless rate is at a record 11.8 percent as the economy continues to suffer from the sovereign-debt crisis.

To contact the reporter on this story: Julie Cruz in Frankfurt at jcruz6@bloomberg.net

To contact the editor responsible for this story: Celeste Perri at cperri@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.