H&M Q3 sales grow but profit down on summer discounts

Markets Associated Press

Swedish low-cost fashion brand Hennes & Mauritz AB says its sales grew a modest 5 percent in the third quarter, and said summer discounts hurt profits.

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Net sales during the June-August period amounted to 51.2 billion kronor ($6.3 billion), up from 48.9 billion kronor a year earlier.

However, the group's net profit for the period fell around 20 percent to 3.8 billion kronor, mainly due to "aggressive summer sale" in markdowns of piled up unsold garments.

It said its push into online sales isn't offsetting a decline in footfall at its traditional retail outlets.

CEO Karl-Johan Persson said Thursday the fashion sector "is in a period of extensive and rapid change as a result of ongoing digitalization."