Fashion retailer H&M Hennes & Mauritz AB on June 15 reported fiscal second-quarter sales that fell short of expectations.
The Swedish company, which is struggling to adapt to reduced footfall at its stores and the shift to online shopping, said sales in the three months ended May 31 edged up 1.2% year over year to 51.98 billion Swedish kronor from 51.38 billion kronor in the year-ago period. That was below the S&P Capital IQ consensus estimate for sales of 52.63 billion kronor.
On June 13, Industria de Diseño Textil SA, owner of rival fashion chain Zara, also delivered sales figures below expectations. Sales in the fiscal first quarter ended April 30 for the company, which is also known as Inditex, rose to €5.65 billion from €5.57 billion but were short of the S&P Capital IQ consensus estimate of €5.79 billion.
In order to meet the challenges of the changing market, H&M announced in December 2017 that it planned to accelerate its transformation. This calls for continued integration of physical and digital stores as well as optimization of the H&M brand's store portfolio, including more store closures and fewer openings.
At the end of the fiscal second quarter, H&M said it was operating 4,801 stores, compared with 4,498 a year prior.
The Stockholm-based retailer is scheduled to report earnings for its fiscal first half ended May 31 on June 28.
In early trading in Stockholm on June 15, H&M's shares were down 5.74 kronor, or 4.1%, at 134.32 kronor.
As of June 14, US$1 was equivalent to 8.69 Swedish kronor.