Half-year Report 1 December 2000 - 31 May 2001

HALF-YEAR REPORT 1 December 2000 - 31 May 2001 · Turnover for the H&M Group amounted to SEK 21,391 M (SEK 17,242 M), an increase of 24 per cent. In comparable currency rates, the increase was 17 per cent. · Good sales development during the second quarter. Increased market shares in all countries. · Turnover for the second quarter amounted to SEK 11,758 M (SEK 8,977 M), an increase of 31 per cent compared with the previous year, in comparable currency rates the increase was 21 per cent. · Profit after financial items was SEK 2,132 M (SEK 1,813 M), an increase of 18 per cent. · Profit after financial items for the second quarter was SEK 1,561 M (SEK 1,142 M), an increase of 37 per cent. · During the first six months, the Group opened 49 stores. In the next six months, approximately 50 stores are planned to open. Turnover Turnover including VAT of the H&M Group increased by 24 per cent in the first six months (in comparable currency rates, 17 per cent) and amounted to SEK 21,391.3 M (SEK 17,242.0 M). Turnover for the second quarter increased by 31 per cent (in comparable currency rates, 21 per cent) During the first six months, the Group opened 49 stores; 11 in the USA, 10 in Germany, nine in Great Britain, seven in France, three in Norway, two each in Switzerland, the Netherlands and Austria and one each in Denmark, Finland and Spain. One store was closed in the Netherlands. The total number of stores in the Group thus amounts to 730 (633). Sales outside Sweden accounted for 88 per cent (85 per cent). Profits Gross operating profit for the first six months amounted to SEK 9,091,4 M (SEK 7,438.8 M). The result achieved corresponds to 49.8 per cent (51.0 per cent) of sales. After deduction for selling and administrative expenses, operating profit was SEK 2,003.8 M (SEK 1,683.3 M). The result corresponds to an operating margin of 11.0 per cent (11.5 per cent). Operating profit for the period has been charged with depreciation according to plan amounting to SEK 438.4 M (SEK 302.6 M) and start-up costs, i.e. the part of the investment in new premises which is treated as a cost item, of SEK 99.1 M (SEK 213.5 M). After depreciation but before start-up costs, operating margin reached 11.5 per cent (13.0 per cent). Group financial net interest income was SEK 127.7 M (SEK 129.4 M). Profit after financial items reached SEK 2,131.5 M (SEK 1,812.7 M), an increase of 18 per cent. Profit after financial items for the second quarter amounted SEK 1,560.8 M (SEK 1,142.2 M), an increase of 37 per cent. Profit for the Group after comprehensive tax allocation for the first six months was SEK 1,385.5 M (SEK 1,178.3 M), corresponding to earnings per share of SEK 1.67 (SEK 1.42). Profit for the second quarter after comprehensive tax allocation was SEK 1,014.5 M (SEK 742.5 M), corresponding to earnings per share of SEK 1.23 (SEK 0.90). Return on shareholders' equity (revolving 12 months) was 24.3 per cent (31.0 per cent) and return on capital employed (revolving 12 months) was 37.7 per cent (47.3 per cent). Comments on the Results for the second quarter Sales development during the second quarter is considered good with increased market shares in all countries of operation. Gross margin, which during the quarter decreased by 0.4 percentage units compared with the same period last year, has been negatively affected approximately 0.5 percentage units by the increasing value of the US dollar. Furthermore, the quarter has been charged with extraordinary price reductions on the American market of approximately SEK 50 M, due to stock levels budgeted too high. Price reductions for the rest of the Group were at a lower level than during the corresponding quarter last year. The result for the quarter has been affected positively by currency translation effects by SEK 137 M compared with the previous year. The currency translation effects arise when results of foreign subsidiaries are translated into SEK in order to be consolidated into the H&M Group accounts. Financial position Group balance sheet total increased by 15 per cent and corresponded to SEK 16,060.7 M (SEK 13,913.4 M). During the period, the Group generated a positive cash flow of SEK 85.4 M (SEK -576.6 M). Financial assets amounted to SEK 5,735.8 M (SEK 6,157.3 M) a decrease of SEK 421.5 M. Stock-in-trade was SEK 3,943.3 M (SEK 3,191.2 M), an increase of 24 per cent. Nine percentage units of the increase are attributable to changes in exchange rates. Investments in fixed assets amounted to SEK 776.1 M (SEK 996.9 M). The equity/assets ratio corresponded to 78 per cent (73 per cent) and the share of risk-bearing capital was 82 per cent (77 per cent). Net worth apportioned on the outstanding 827,536,000 shares on 31 May corresponded to SEK 15.15 (SEK 12.30). Expansion The planned store opening programme continues according to plan. During the rest of the fiscal year, approximately 50 stores will be opened principally in the USA, Germany, Great Britain and Austria. The Parent Company The parent company, which is not the same as the Swedish operations, reached a turnover (including inter-company sales) during the period of SEK 2,691.9 M (SEK 2,797.4 M) and estimated taxable profit of SEK 726.3 M (SEK 956.7 M), of which SEK 729.9 M (SEK 835.2 M) was dividend from subsidiaries. This half-year report has not been audited. A report for the first nine months of the financial year will be published on 28 September 2001. A report for the fiscal year 2000/2001 will be published on 30 January 2002. Stockholm 21 June 2001 The Board of Directors Contact persons: Rolf Eriksen, CEO +46 8 796 52 33 Carl-Henric Enhörning, IR+46 8 796 54 10 Leif Persson, CFO +46 8 796 13 00 Switchboard +46 8 796 55 00 Information about H&M and press photographs are available at www.hm.com ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.bit.se/bitonline/2001/06/21/20010621BIT00300/bit0002.doc The full report http://www.bit.se/bitonline/2001/06/21/20010621BIT00300/bit0002.pdf The full report