• The H&M group's net sales in local currencies increased by 12 percent in the 2021 financial year. Converted into SEK the group's net sales increased by 6 percent to SEK 198,967 m (187,031).
• Gross profit increased to SEK 105,006 m (93,544). This corresponds to a gross margin of 52.8 percent (50.0).
• Profit after financial items increased to SEK 14,300 m (2,052).
• The group's profit after tax increased to SEK 11,010 m (1,243), corresponding to SEK 6.65 (0.75) per share.
• Cash flow from operating activities increased to SEK 44,619 m (25,900).
• Financial net cash increased to SEK 17,857 m (208). Cash and cash equivalents plus undrawn credit facilities amounted to SEK 42,649 m (46,595).
• The year's increase in profit means that SEK 224 m has been allocated to the H&M Incentive Program (HIP), which is for all employees.

• The H&M group's net sales in local currencies increased by 11 percent in the fourth quarter 2021. Converted into SEK net sales increased by 8 percent to SEK 56,813 m (52,549).
• Gross profit increased by 14 percent to SEK 31,341 m (27,375). This corresponds to a gross margin of 55.2 percent (52.1).
• Profit after financial items increased by 64 percent to SEK 6,003 m (3,665). Before the allocation to HIP, profit for the quarter increased by 70 percent. The strong result for the quarter is mainly a result of well-received collections with more full-price sales, lower markdowns and good cost control.
• The operating margin was 11.0 percent (7.4).
• The group's profit after tax increased to SEK 4,621 m (2,485), corresponding to SEK 2:79 (1:50) per share.
• The stock-in-trade decreased to SEK 37,306 m (38,209).

• By 2030 at latest the H&M group is to double sales while at the same time halving its carbon footprint. Profitability is to exceed 10 percent over time.*
• To achieve the ambitious growth and climate goals, investments are being increased. For 2022 capex is expected to amount to around SEK 10 billion.
• In 2022 H&M will launch in six new markets: the first stores will open in Ecuador, Kosovo and North Macedonia, and via franchise in Costa Rica, Guatemala and Cambodia.
• The rollout of H&M online continues in 2022 with Belarus; Colombia, Kazakhstan, Peru and Ukraine.
• The board of directors proposes an ordinary dividend of SEK 6.50 per share to be paid in two instalments, and authorisation for a SEK 3 billion share buyback programme.
• For the period 1 December 2021 to 31 January 2022 sales in local currencies are expected to increase by 20 percent compared with the same period last year. The period was negatively affected by the latest wave of the pandemic and its consequences in many of the group's larger markets.

"We ended the year strongly, with sales back at the same level as before the pandemic and with profitability better than it has been for several years. Now that we are back to a more normalised situation with a strong financial position and good profitability, we can fully focus on growth again,"
says Helena Helmersson, CEO.

*The baseline for the sales goal is 2021. The H&M group's goal is to reduce its carbon footprint in absolute figures by 56 percent by 2030 (baseline 2019) in accordance with our commitment at COP26. Profitability refers to operating profit in relation to sales. The ambition is to achieve the profitability target no later than 2024. The group's target to increase sales by 10-15 percent per year with continued high profitability remains a long-term target.

Returning to growth

"The H&M group's strong recovery continues. Customers are showing that they appreciate our customer offering with the best combination of fashion, quality, price and sustainability. By quickly taking decisive action we have succeeded in managing the negative effects of the pandemic. We ended the year strongly, with sales back at the same level as before the pandemic and with profitability better than it has been for several years. Now that we are back to a more normalised situation with a strong financial position and good profitability, we can fully focus on growth again. We see significant opportunities to grow both sustainably and profitably. The goal for 2030 is to double sales while at the same time halving our carbon footprint. Profitability is to exceed 10 percent over time.

The H&M group's strong cash flow and financial position will be crucial for our ability to invest in sustainable growth. In 2022 we will double the level of investment. Alongside initiatives linked to each growth area we will invest further in infrastructure such as tech and the supply chain, but also in renewable energy and sustainable materials.

H&M. We will strengthen, develop and broaden the offering to include more products and services in order to develop our relationships with customers and attract even more customers around the world. The stores and the customer experience will continue to play a key role. The optimisation of the store portfolio remains successful. Now we are stepping up the pace of investment in both our physical and digital stores to elevate and strengthen the integrated experience further.

Portfolio brands and business ventures. We are consistently growing through our other brands, new business models and initiatives. All have great growth potential individually, but also in how they complement and strengthen the H&M group. All of them start from what customers ask for and in addition they help make the fashion industry more sustainable.

Investments and partnerships. Through our investment arm Co:lab we now have around 20 investments in new companies that are important for the H&M group's growth strategy. In a short time these investments have created significant value both financially and in the existing operations, for example by improving the customer experience and enabling innovation in sustainable materials. In an industry in rapid transition exciting opportunities arise, and we are constantly evaluating investments and acquisitions that could contribute to the H&M group's continued sustainable growth.

While we respect the ongoing challenges brought by the pandemic, we have demonstrated our ability to quickly adapt and seize opportunities that arise. Customer focus, quick action and flexibility have been key in managing the pandemic and will be just as important going forward. Customers must always feel confident that with us they will be able to find the best combination of fashion, price, quality and sustainability. With continued satisfied customers and strong relations with all our partners, we are optimistic about the opportunities for long-term and sustainable growth for the H&M group."

Helena Helmersson, CEO
  

Communication in conjunction with the full-year report

The full-year report for the 2021 financial year, i.e., 1 December 2020 - 30 November 2021, will be published at 08:00 CET on 28 January 2022, followed by a telephone conference at 09:00 CET for the financial market and media. The telephone conference will be held in English, hosted by CEO Helena Helmersson, CFO Adam Karlsson and Head of IR Nils Vinge.

For log in details for the telephone conference please register at hmgroup.com or via this link: http://emea.directeventreg.com/registration/4189924.

To book interviews in conjunction with the full-year report on 28 January 2022, please contact: Kristina Stenvinkel, telephone: +46 70 796 54 40, stenvinkel@hm.com.

Contact

Nils Vinge, Head of IR                       +46 8 796 52 50
Helena Helmersson, CEO                  +46 8 796 55 00 (switchboard)
Adam Karlsson, CFO                        +46 8 796 55 00 (switchboard)

H & M Hennes & Mauritz AB (publ)
SE-106 38 Stockholm
Phone: +46-8-796 55 00, fax: +46-8-20 99 19, e-mail: info@hm.com
Registered office: Stockholm, Reg. No. 556042-7220

For more information about the H&M group visit hmgroup.com.
 

Information in this interim report is that which H & M Hennes & Mauritz AB (publ) is required to disclose under the EU Market Abuse Regulation (EU)
No 596/2014. The information was submitted for publication by the abovementioned persons at 08:00 (CET) on 28 January 2022. This full-year report and other information about the H&M group, is available at hmgroup.com.

H & M Hennes & Mauritz AB (publ) was founded in Sweden in 1947 and is quoted on Nasdaq Stockholm. H&M's business idea is to offer fashion and quality at the best price in a sustainable way. In addition to H&M, the group includes the brands COS, Monki, Weekday, & Other Stories, H&M HOME and ARKET as well as Afound. The H&M group has 54 online markets and approximately 4,800 stores in 75 markets including franchise markets. In 2021, net sales were SEK 199 billion. The number of employees amounts to approximately 155,000. For further information, visit hmgroup.com.