Swedish fashion group H&M reported disappointing third-quarter earnings today and said it would open fewer stores than planned this year because of a difficult property market in southern Europe and France.
The clothing giant, the third-biggest fashion group in the world after Spain's Inditex (Zara) and Gap of the US, posted a net profit up 23% from last year, to 4.24 billion Swedish kronor (€632.3m). But the earnings missed expectations.
The company's sales were up 14% to 26.9 billion kronor, beating expectations of 26.6 billion kronor.
H&M said it would open fewer stores than planned because the completion of shopping centres, mainly in southern Europe, had been stopped because of the weak economy.
'As a consequence, the planned store net for the full-year will be approximately 220 compared to the 240 stores previously communicated,' the company said.
H&M chief executive Karl-Johan Persson said the concerned countries were Italy, Spain, Portugal and Greece, but also France and the US.
'Everything happened quite brutally. Some projects were abandoned, others delayed. There just weren't enough good alternatives,' he said.
The cheap'n'chic fashion group had 2,078 stores worldwide at the end of August.
