Comparable sales slipped 1% in November

Comparable sales slipped 1% in November

Swedish fashion retailer Hennes & Mauritz (H&M) today (17 December) said its comparable sales edged down 1% in November, slowing the 5% decline seen in October.

Comparable units comprise the store, internet and catalogue sales in countries that have been in operation for at least one financial year.

Sales including VAT in local currencies increased 7% compared to the same month last year, helped by the addition of 304 new stores during the year. The retailer now operates 2,776 stores, compared to 2,472 the year before.

During the fourth quarter to 30 November, comparable sales were unchanged. Sales including VAT increased 9% in local currencies to SEK37.93bn (US$5.71bn), compared to the same period last year. 

Bank of America Merryll Lynch analyst Richard Chamberlain said H&M appeared to outperform its major markets in November.

"We think H&M's largest market Germany (around 20% of sales) and surrounding markets were again tough with industry data suggesting -5% for the month. Other western European markets were a little better with both France and Sweden -1% year-on-year and the UK small positive."

But a strong Thansgiving weekend in the US did not to compensate for the negative impact of Hurricane Sandy in the first two weeks of the month, Chamberlain added.

He also sees a weaker Euro continuing to drag on H&M's top line in the first-half of its next financial year, while raw material prices and the impact of the $/Euro exchange rate on Asian sourcing costs should become a tailwind during the year.