H&M names Helmersson new CEO as Q4 profits look strong
H&M’s quarterly profits are always big news, but Thursday’s report was overshadowed by the announcement that the company has a new CEO. Helena Helmersson is taking over from long-time CEO Karl-Johan Persson, who will become chairman, taking over from his father Stefan Persson who has held the post for 20 years.
It’s a watershed moment for the business that’s one of the biggest fashion retailers globally and has moved during the chairman’s tenure from being a single brand company to owning nine labels in total.
While the chairman change will happen in a few months, Helmersson, who’s an H&M veteran and has been COO for a year, takes up her new role immediately.
Born in 1973, she started at the firm in 1997 as an economist at H&M’s buying department and held various roles within buying and production. Importantly, she was sustainability manager for five years, and after that production manager based in Hong Kong.
The outgoing chairman said: “It is a natural change, after 20 years, to hand over to Karl-Johan, who has been CEO for more than 10 years. I will continue to be a committed owner, just as today, but from a different position. In addition, the timing is favourable for making this change now since we have gradually improved profits and have a strong position with many well-established brands, millions of customers worldwide and good financial strength”.
He added that “Karl-Johan and the team have done an amazing job to secure the future of the H&M group. I am fully convinced that he will do an excellent job also as chairman. I feel confident in handing over the CEO role to Helena, who is an experienced and great leader who embodies our values. Helena will continue to work on the plan that we have adopted for 2020 and onwards”.
The company also said that its Q4 pre-tax profit in the period to the end of November rose to SEK5.4 billion (£432.6m) from SEK4.35 billion. That was significantly more than the SEK4.78 billion that analysts had been predicting. The group’s profit after tax increased to SEK4.212 billion from SEK3.543 billion.
That came as its net sales rose 9% to SEK61.694 billion. In local currencies, net sales rose 5% and in the period since the end of the quarter, they've risen by 5% in local currencies too.
The company said the cost of markdowns in relation to sales is estimated to fall by around 0.5-1 percentage point in Q1. And it added that “online and physical stores are being increasingly integrated with continued optimisation of the store portfolio”.
Developments this year will include both physical spaces and webstores. Around 200 new stores are planned to open in 2020, mainly in growth markets, but there are also around 175 planned store closures, mainly in established markets. Australia is scheduled to become a new H&M online market in the second half of 2020 and H&M will be launched on the e-commerce platform SSG.COM in South Korea this year.
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