H&M’s Online Expansion Boost Sales

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June 18 (Bloomberg) -- Bloomberg’s Charles Allen reports on the H&M earnings and how the company is using technology to fuel growth. He speaks with Anna Edwards on Bloomberg Television’s “On The Move.” (Source: Bloomberg)

Charles allen.

What is behind the outperformance and the fact that they have beat estimates this morning?

Cost control, sales were good, which we knew.

Gross margins down just a touch.

They have a lot of operational leverage.

Where will they get more growth?

Broadly speaking, a lot of countries where they are still immature.

They just opened a store in melbourne.

I'm sure they can go to quite a lot.

And then you have online, eight to 10 markets will be open this year.

One of the lessons about h&m you reminded me of is the fact that they've had a mail-order business for some time will stop that is what -- a mail-order business for some time.

They said because they have been doing this catalog delivery for so long, that has helped them transition very quickly.

The mail-order customer is different with different behavior.

One sees a lot of the new internet only companies learning the lessons that made -- that older company's new 25 years ago.

H&m has this business in sweden.

Enabled them -- it enabled them to understand.

A lot of the merchandise comes back and how you can resell it profitably.

The demographics might be different, but the return policy is something you have to deal with in both scenarios.

What about north and south?

If you look at germany, the u.k., and the u.k. has really picked up.

We knew u.k. apparel sells were strong.

Sales were strong.

Spain -- we knew that u.k. apparel sales were strong.

Spain, it is not the 20 plus that they have got in the u.k. you have mentioned the expansion into australia, amazing they have been around in europe for so long, but they have not had a presence until recently in australia.

The southern hemisphere has always been difficult because of the difference in the seasonality.

Are you anticipating your next season or are you selling people castoffs?

We saw this australian business cell northern hemisphere fashions.

People in the southern hemisphere want to make sure there is something unique for them as well.

Thank you very much for joining us.

Still to come, it is a bird, it is a plane, it is a rocket on wheels.

Years are attempting to -- engineers are attempting to break the speed records.

We will take you toa tour behind the wheel.

Here is a picture of the markets.

A short break on "on the move." we will be back on the other

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