Swedish fast-fashion giant H&M Group announced on January 27 sales for its Asia and Oceania region lifted 11.7 percent, to SEK 29.4 billion (USD 2.8 billion), for the period 1 December, 2021 to 30 November, 2022.
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Full-year operating profit in the company’s Asia and Oceania region grew 61 percent, to SEK 689 million, added the Stockholm-headquartered company, while fourth quarter sales in its Asia, Oceania and Africa region increased 8 percent in constant currency to SEK 7.8 billion.
The company described 2022 as a “turbulent year,” impacted by external headwinds such as “geopolitical challenges and substantial cost inflation.” Despite all that, the company, which also operates the Monki, COS, Weekday, and & Other Stories brands, said total sales increased by 6 percent during the year.
“Having left the worst of the negative effects of the pandemic behind us, war broke out in Ukraine…The hikes in raw materials and freight costs combined with a historically strong US dollar resulted in extensive cost increases for purchases of goods… On top of this, there were increased energy costs as well as a one-time charge for the cost and efficiency programme that was initiated at the end of the year,” said Helena Helmersson, CEO of H&M Group, in talking about the challenges faced in 2022.
“Our highest priority is the H&M brand, where we are continuing to work on improving the assortment and the customer experience both in store and online while at the same time integrating the two channels further. Development of all our brands continues in parallel, alongside initiatives in areas such as sport, beauty and home. Despite the tough situation in the world around us the H&M group stands strong, with a robust financial position, healthy cash flow and a well-balanced inventory.
Looking ahead, H&M said its sales in the new financial year have “started well,” and while external factors are still challenging, the company said it is “moving in the right direction.”
“Combined with our investments and efficiency improvements, there are very good prerequisites for 2023 to be a year of increased sales, improved profitability and lower inventory. Thus, our goal of achieving a double-digit operating margin for full-year 2024 remains in place,” added Helmersson.