Fashion giant, H&M missed market expectation as profits dropped in 2018, H&M overhauled the business by investing heavily in transforming products and their systems in 2018.
Profit before tax fell to £1.32bn, 25% coming short of consensus expectations however, the company performed better in the second half, as sales rose to £17.75bn, 5% in the year to 30 November 2018.
Karl-Johan Persson, chief executive of H&M said, “It has been a challenging year for H&M group and the industry but after a difficult first half, there are signs the company’s transformation efforts are beginning to take effect.
“Improved collections generated better full-price sales and lower markdowns towards the end of the year.”
Maureen Hinton, group retail research director at GlobalData said, “The introduction of services such as click and collect, online return to stores, and next day delivery, are being rolled out, but are in less than 11 of its 47 markets to date and are still behind competitors who have been offering these services for several years, and have moved on to much faster and more innovative options.
“While its online penetration has reached 14.5%, the UK, which is a benchmark for online, has an average for clothing & footwear online of 27%, demonstrating how far H&M still has to go.”