Shares of H&M (STO: HMb) soared more than 12% on Tuesday morning after the fashion retailer smashed profit expectations. A preliminary quarterly profit before tax for the period June – August was reported at around 2 billion crowns ($229 million). s
Analysts expected “only” 191 million crowns profit for the reported period. A year ago, H&M recorded a profit of 5.01 billion crowns. A falling year-on-year profit came after net sales plunged 19% to 50.9 billion crowns from a year earlier, worse than an 18% fall expected from the market.
“As a result of appreciated collections together with rapid and decisive actions, the H&M group's recovery is better than expected,” the Swedish firm said in a statement.
“More full-price sales combined with strong cost control enabled the company to already turn to profit in the third quarter.”
The Sweden-based fashion retail giant witnessed a stronger rebound than expected in a quarter following the lockdowns and store closures.
“Third-quarter profit is indicated much better than expected,” said Societe Generale analyst Anne Critchlow.
“This would be 60% down on last year’s 5 billion crowns, but is still very good news and well above consensus.”
H&M share price soared more than 12% today to hit a 3-month high above 160.00