Swedish fashion giant H&M’s third quarter profit has leapt 20 per cent year on year, but a slight fall in gross profit margins linked to increased expansion costs has disappointed investors.The group’s net profits reached 5.3 billion kronor ($A836 million) — less than analysts had expected following strong sales figures for July and August.September sales were down so far due to “unusually warm weather in most markets”, the group said in a statement on Th
ursday, adding that gross profit margins had fallen from 58.8 per cent to 58.3 per cent.Turnover grew by 22 per cent to 45.4 billion kronor, driven by the rapid expansion of the group which has diversified its brands, reporting “continued strong sales development” for COS, & Other Stories, Monki, Weekday, Cheap Monday, and H&M Home.“We have continued to gain market share thanks to strong sales development for all our brands. We see this as proof of well received collections,” H&M CEO, Karl-Johan Persson, said in a statement.He added that the group, which currently has 3300 stores, was on schedule to add another 375 during 2014, opening in the Philippines in October and expanding to South Africa, Peru, Taiwan, and Macau in 2015.A planned expansion to India in autumn 2014 was postponed until 2015.The group also continued an online expansion with internet sales launches in France in March, Italy, and Spain in August and China in September.“Our online openings have taken place at a rapid pace this year…. We have had a very good response from customers in all these countries,” said Persson, adding that the company planned to open eight to 10 new online markets next year.AF
