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Fashion retailer H&M has reported a rise in sales in its first-quarter results, despite being “negatively impacted” by the outbreak of Covid-19.
For the period ended 1 December 2019, H&M reported an 8% increase in net sales to SEK 54,988m (£46,609m) compared with £51m in the year prior.
H&M said sales development in the second half of the quarter was “negatively impacted by the outbreak of the Covid-19 virus, particularly in China. From 1 December 2019 to 23 January 2020, sales increased by 27% in local currency.
However, the fashion retailer said demand also decreased “significantly” as a result of the rapid development of the virus, and therefore H&M’s group sales in China decreased by 24% in the quarter as a whole. At its peak, 334 of the group’s 518 stores in China were closed in February.
Excluding China, Hong Kong, Singapore, Macau, Japan and Taiwan the H&M group’s sales in the quarter increased by 7% in local currencies.
H&M said so far in March, sales have been negatively affected mainly in Europe as a consequence of the continued spread of the virus, resulting in temporary store closures in Italy, Poland, Spain, France and Belgium.
It said online stores remain open and sales in China have started to gradually “recover” as the “situation in the country has improved”.
H&M said: “The H&M group is working extensively to manage the Covid-19 situation, the highest priority being the safety of employees and customers.
“While the H&M group’s transformation work continues at full speed, all activities in the company are now being carefully evaluated – including from a cost and risk perspective – so as to be able to mitigate the negative effects associated with the virus as far as possible.”
H&M is due to publish its three-month report, covering the period between 1 December 2019- 29 February on 3 April.
