Pre-tax profits at the Irish arm of clothing retail giant, H&M last year increased five fold to €3.87m as its 'bricks and mortar' stores delivered a "solid performance".
New accounts show that pre-tax profits increased by 437% at the Swedish owned H&M Hennes & Mauritz (Ireland) Ltd as revenues declined by 1% or €1.2m from €113.2m to €111.99m in the 12 months to the end of November 30th 2024.
In their report, the directors state that the business "delivered a significantly stronger performance compared to FY23, despite ongoing challenges within the retail sector".
The directors state that the overall decline in revenues "was primarily due to lower-than-expected customer demand in the online channel but was partly offset by a positive store performance 1.86pc, reflecting the solid performance of the physical store portfolio".
During the year under review, H&M opened a new outlet at Clery’s Quarter in March 2024 and at 30,000sq ft spread across two floors is the second largest store for H&M in Ireland.
During 2024, the company operated 22 stores across the country made up of 15 H&M stores, one & Other Stories store and six COS stores.
The directors state that "the increase in profitability can be attributed to optimisation of cost structure and streamlining processes".
During the year, the company’s operating expenses reduced by 6% from €64.75m to €61.05m as cost of sales reduced from €48.23m to €47.45m.
The company benefited from net finance income of €266,083 compared to €168,476 under that heading in 2023.
The company continued its expansion here with the opening of the first Arket store in Ireland on Dublin’s Dawson last month and the directors state that the store "will further strengthen our physical footprint and broaden the range of brands available to customers".
The directors state that "the company continues to grow and integrate physical and digital channels, we are ensuring that we have a well-balanced, healthy and relevant store portfolio. Our online and physical stores complement one another and strengthen our customer offering".
They further states that the company is focusing to meet new consumer trends and to enable this strategy the directors will focus on redeveloping the existing store portfolio to enhance the customer experience and maximise the omni-channel shopping experience.
The firm had a post tax profit of €2.95m after recording a corporation tax charge of €912,116.
The opening of the new H&M at Clery’s Quarter contributed to staff numbers rising by 67 from 474 to 541 as staff costs rose from €10.54m to €11.96m.
The profit for 2024 takes account of non-cash depreciation costs of €5.43m and rental costs increasing by €726,712 from €3.96m to €4.68m.
The company received unspecified other operating income of €111,607 in 2024 compared to €325,801 under that heading in 2023.
At the end of November 2024, the firm had shareholder funds of €18.19m that included accumulated profits of €11.6m.
Reporting by Gordon Deegan
