H&M September sales down as cost-cutting continues at "full speed"

H&M has warned over tumbling sales in September, expecting a fall of 10% year-on-year in local currencies.

While four percentage points of the sales decline is down to the group’s discontinued operations in Russia, it said the drop should be "seen in the light of unusually hot weather in several of the company’s European markets, which has had a substantial negative impact on sales during the month".

Retail analyst James Grzinic at Jefferies said H&M’s performance in recent weeks shows current trading is "as pressured as feared".

H&M reported a leap in earnings over the three months to 31 August, at £345 million (SEK 4.74 billion), up from £65.6 million (SEK 902 million) a year earlier, when results were hit by its exit from Russia.

But sales over the third quarter were "flattish" over its third quarter in local currencies. When translated into Swedish krona, sales lifted 6%, it said.

Helena Helmersson, CEO at H&M, said: "There was a weaker end to the quarter, with comparative figures affected by the temporary reopening in Russia in August last year.

"Having now moved into September, we can see that the start of the autumn season has been delayed because the month so far has been marked by unusually hot weather in many of our European markets."

The company said it was on track to reach its goal to increase operating margin to 10% by the end of next year, while Helmersson said the group’s cost-cutting programme was continuing at "full speed".

Earlier this week, H&M unveiled its reimagined own-brand makeup range, showcasing an assortment that is "sleeker and better than ever before".

The collection, which launches globally from October, offers "top makeup shelf essentials at a price that feels unexpected and pleasantly surprising".

Formulated with "skin-loving" ingredients, the new range includes mascaras, blush, highlighters, lipsticks and brow pencils.