STOCKHOLM, Sweden, Jan. 30, 2002 (PRIMEZONE) -- H & M Hennes & Mauritz:
-- Group turnover for the year amounted to SEK 46,528 M (35,876)
including VAT, an increase of 30 per cent compared to last year.
With comparable exchange rates, the increase was 20 per cent.
-- Profit after financial items was SEK 5,734 M (4,003), an increase
of 43 per cent.
-- Turnover for the fourth quarter amounted to SEK 14,172 M (10,448)
including VAT, an increase of 36 per cent. With comparable
exchange rates, the increase was 24 per cent.
-- Profit after financial items for the fourth quarter was
SEK 2,356 M (1,390), an increase of 69 per cent.
-- Increased market shares in all H&M countries.
-- In 2002, approximately 90 new stores are planned to open. The USA
continued important market for expansion. Somewhat lower expansion
rate on the American market than originally planned.
-- The Board of Directors proposes a dividend of SEK 1.75 (1.35)
per share.
Turnover
Turnover incl. VAT for the H&M Group increased during the year by 30 per cent (with comparable exchange rates, the increase was 20 per cent) compared with last year and amounted to SEK 46,528.2 M (35,876.1).
Turnover during the fourth quarter was SEK 14,172.0 M (10,448.0) incl. VAT, an increase of 36 per cent (with comparable exchange rates 24 per cent).
Increased customer focus, good collections and a well balanced assortment have resulted in very positive sales development during the year.
H&M has increased its market share in each country of operation.
In 2001, 93 new stores were opened and four were closed. Of the net increase of 89 stores, 37 were opened and two were closed during the fourth quarter. Group number of stores hereby amounts to 771 per 30 November 2001.
Sales outside Sweden accounted for 88 per cent (85) of total sales.
Profits
Gross profit for the year amounted to SEK 20,499.1 M (15,396.8), which corresponds to 51.6 per cent (50.6) of sales.
After deduction of selling and administrative expenses, operating profit was SEK 5,477.8 M (3,766.6). This corresponds to an operating margin of 13.8 per cent (12.4).
Operating profit has been charged with depreciation according to plan of SEK 900.1 M (629.1) and start-up costs, the part of investments in new stores that is charged directly to the income statement, of SEK 193.0 M (315.7). Operating margin calculated on the result after depreciation but before start-up costs thereby was 14.3 per cent (13.4).
Group financial net interest income amounted to SEK 256.2 M (236.6).
Profit after financial items was SEK 5,734.0 M (4,003.2), an increase of 43 per cent.
After deduction of taxes of SEK 1,917.6 M (1,450.5), profit for the year amounted to SEK 3,816.4 M (2,552.7). The result achieved corresponds to earnings per share of SEK 4.61 (3.08).
Return on shareholders' equity was 27.9 per cent (23.0) and return on capital employed was 41.6 per cent (35.8).
In the fourth quarter, operating profit was SEK 2,293.5 M (1,342.9), corresponding to an operating margin of 18.9 per cent (15.1).
Profit after financial items for the fourth quarter amounted to SEK 2,356.0 M (1,390.4), an increase of 69 per cent.
This financial year, recommendation no 9, income taxes, issued by the Swedish Financial Accounting Standards Council, has been applied. The taxes for 2001 have thereby been reduced by SEK 152.0 M compared to earlier principles.
Comments on the Results
This year's result is strong, in spite of a weak first quarter and a continued substantial expansion on new markets.
The result has among other things been affected by:
-- positive currency translation effects as a result of the weakened
SEK, SEK +560 M, compared with last year,
-- full effect of the cost reduction programme, SEK + 300 M, compared
with last year.
The operations in the USA and Spain, excl. extraordinary price reductions, have charged the result with SEK 620 M.
Comments on the Fourth Quarter
Sales development was good in the fourth quarter. Gross profit amounted to SEK 6,618.2 M (4,540.6) which corresponds to a gross margin of 54.7 per cent (51.0). Full effect of adjusted volumes and good collections have resulted in considerably lower price reductions. The company's endeavour has been to have a lower stock at the end of the seasons in order to reach a better gross profit through considerably lower price reductions during the clearance sales periods.
Liquidity and Financing
The Group balance sheet increased by 30 per cent and was on 30 November 2001 SEK 20.410.3 M (15,700.4).
During the year, the H&M Group generated a positive cash flow from current operations of SEK 6,012.3 M (1,941.2). SEK 2,035.7 M (2,525.0) was invested through acquisitions of fixed assets.
The financial assets amounted to SEK 8,530.9 M (5,403.2), an increase of 58 per cent.
Stock-in-trade decreased by 3 per cent (+ 23) and amounted to SEK 4,332.4 M (4,448.7). Stock-in-trade equals 10.9 per cent (14.6) of turnover and 21.2 per cent (28.3) of total assets. The stock level has decreased as a result of adjusted purchase volumes and a good sales development.
The Group's debt ratio was 1.2 per cent (1.2). The share of risk-bearing capital was 77.8 per cent (79.8).
The Group's equity was on 30 November 2001 SEK 15,431.6 M (11,889.8), which apportioned on the 827,536,000 outstanding shares equals SEK 18.65 (SEK 14.37) per share.
Expansion
In the financial year 2001/2002, approximately 90 new stores are planned to open and approximately 10 to close down. The majority of the expansion will take place in H&M's growth markets Germany, France, the USA, Spain and Great Britain.
H&M has a continued strong belief in the USA as an important market for expansion. At the end of the financial year, there were 30 stores in the USA and a further 12 are planned to open in 2002. The somewhat lower expansion rate than originally planned for the USA is due to the uncertainty on the American market after September 11, 2001, as well as to our ambition to more rapidly achieve higher efficiency in the existing stores in the USA.
The changed situation on the American rental market gives H&M the possibility to be more selective and thereby achieve better conditions at future rental negotiations.
Employees
The average number of employees in the Group was 22,944 (20.680), of which 3,523 (3.556) worked in Sweden.
The Parent Company
The parent company's profit after financial items, which is not equivalent to results from total operations in Sweden, amounted to SEK 1,637.6 M (2,034.7). Adjusted for dividend revenue from subsidiaries, the result was SEK 231.4 M (359.4). This year's profit after dispositions and tax amounted to SEK 1,528.4 M (1,933.7).
December 2001
H&M Group turnover (with comparable exchange rates) increased in December 2001 by 10 per cent compared with the corresponding period last year. A substantially lower stock level compared with December 2000 has led to a more quiet sales development. Lower price reductions have resulted in a considerably improved gross margin for the period.
Dividend
The Board of Directors will propose to the Annual General Meeting a dividend of SEK 1.75 (1.35) per share.
Annual General Meeting of Shareholders
The shareholders' meeting will be held on Friday, 19 April 2002, at 3 pm at Stockholmsmassan in Stockholm (Victoriahallen).
The Annual Report is estimated to be published and distributed to shareholders during week 11, 2002. The annual report will be accessible at the head office of H&M, Regeringsgatan 48, Stockholm, telephone: +46- 8-796 55 00 and on www.hm.com.
Reports
The H&M Group will publish the following financial reports during 2002:
Sales development - January 15 February First Quarter results, 1 December 2001 - 28 February 2002, including sales development - February 22 March Sales development - March 15 April Sales development - April 15 May Half Year results, 1 December 2001 - 31 May 2002, including sales development - May 19 June Sales development - June 15 July Sales development - July 15 August Nine Months results, 1 December 2001 - 31 August 2002, including sales development - August 19 September Sales development - September 15 October Sales development - October 15 November Sales development - November 16 December
Information about H&M and press pictures are available on www.hm.com
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