H&M 4Q profit drops 11 pct amid high cotton prices
Thursday, January 27, 2011
STOCKHOLM (AP) — Swedish fashion retailer Hennes & Mauritz AB says its fourth-quarter net profit dropped by 11 percent as higher raw material prices weighed on margins.
The company says net profit fell to 5.49 billion kronor ($846 million) in the quarter, from 6.15 billion kronor in the same period a year ago.
Revenue in the September-November period climbed by 6 percent to 34.8 billion kronor, from 32.8 billion kronor a year earlier.
The Thursday report showed the gross margin dropped to 63.2 percent from 66.3 percent, mainly due to significantly higher prices of cotton, less spare capacity at the suppliers and higher transportation costs.
H&M proposed a dividend of 9.5 kronor per share, up from 8 kronor last year, and said it plans to open around 250 new stores in 2011.
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