Clothing Retailing - UK - October 2015

H&M Hennes & Mauritz

What it does

Latest year end

Sales
Operating profit
Website:
Countries of operation:

Swedish multinational fashion retail company, known for its

fast-fashion clothing for men, women and children. Operates
six distinct independent clothing retail brands: H&M; COS;
& Other Stories; Monki; Weekday; and Cheap Monday.
November 2014
SEK151.4bn (16.6bn) (+17.8%)
SEK25.6bn (2.8bn) (+15.4%)
www.hm.com
55 countries worldwide

What we think
2014 was another successful year for H&M Hennes & Mauritz. The Swedish fashion retail group posted
double-digit sales growth and increased profits. The groups continued success has come on the back of
increased consumer demand for fast fashion, rapid store expansion in existing and new markets and an
expanded e-commerce business. The groups interim results for its latest financial year show sales growth
ahead 23% on the comparable period a year earlier. With a new designer collaboration collection launching
in November 2015 and the retailer preparing to launch into South Africa and India later in 2015, we expect
H&M Hennes & Mauritz to cement its position as one of the worlds leading clothing retailers.
On-trend affordable fashion proposition

Trend-led fashions at an affordable price have made H&M a leading global clothing retailer. Its on-trend
low-price equivalents of catwalk and cutting-edge garment designs have made it a compelling retail
destination for fast-fashion consumers. Alongside its own house brand offering, H&M offers guest-designer
collaborations, critically acclaimed clothing collections from high-profile catwalk designers. The success of
these collaborations has further enhanced the Groups fashion credentials and distinguished it from many of
its high street fast-fashion rivals. In November 2015 H&M will unveil its latest designer collection, this
time collaborating with Parisian luxury fashion house Balmain. Balmain follows in the footsteps of other
guest designers such as Alexander Wang, Roberto Cavalli, Jimmy Choo and Stella McCartney.
H&M Sport potential

H&M will introduce H&M Beauty, a new high-quality value-for-money make-up, bodycare and haircare
range that will replace its current own-branded cosmetics offering later this year. In 2014 it introduced
H&M Sport, a sportswear-focused line. The new products are the latest attempt by H&M to diversify its
product range and ties in with the Mintel Trend Extend My Brand, which is all about how brands are
extending into new categories, offering ancillary goods and services alongside their standard fare.
Research from Mintels Sports Fashion UK, June 2015 report suggests H&M Sport could be a significant
revenue generator for the brand. Whether meant for the gym or not, sportswear is becoming an increasingly
popular everyday clothing trend alternative to traditional everyday wear garments like jeans, with 51% of
those who had purchased sporting goods in the last year having done so to wear outside of sport. The
specialist sportswear retailers have picked up on the trend, but with the exception of a handful of clothing
retailers, it is a category that has been largely overlooked, yet 28% of young women prefer to buy sports
clothing and footwear from a retailer where they shop for clothing. Given H&Ms value-for-money
proposition and fashionable credentials, we think it was a wise move by the brand to launch a sporty
clothing collection, not only to reach out to a wider audience, but also to offer existing customers a broader
variety of clothes and the opportunity to do a complete clothes shop under one roof.
This report is supplied in accordance with Mintel's terms and conditions. Supplied to University of Coventry.
Mintel Group Ltd.

Further store expansion opportunities

H&M Hennes & Mauritz plans to open more new stores in 2015 than it did in 2014, when it opened more
than one new store a day. Buoyed by the well-received store openings in new markets during 2014,
including Australia, and further growth potential in Asia and the US, where sales growth is rapid, the
Swedish clothing giant has identified further store expansion opportunities across its retail brands and
planned to add a net new 400 stores in 2015.
With its distinct retail brands and diverse fashion range, the group is able to embed itself deeper into each
market with a concept that best meets the need of each individual market. Beyond the eponymous brand the
groups other retail brands, such as COS and & Other Stories, are fast becoming internationally established
fashion brands in their own right. The groups principle for expansion is that every store must have the best
location and a shopping experience to match. It achieves this in part through flagship store openings in
major cities, such as Milan, Shanghai and New York.
Expanding and broadening the online offer

In 2014 H&M opened its online store in four new countries: France, Spain, Italy and China. In 2015
hm.com will be available in a further nine countries including Bulgaria, Czech Republic, Poland, Portugal
and Switzerland. By year-end 2015 the online store will be operational in 22 countries. It has also
broadened the product offering with the addition of H&M Sport, its sportswear range, and an extended shoe
range and later this year it will add H&M Beauty, its own-brand cosmetics.
In addition to hm.com, the groups other brands also offer online shopping; COS in 19 countries; Monki,
Weekday and Cheap Monday have online stores in 18 European countries, while & Other Stories sells
online in 13 countries worldwide. The rollout of its online stores will make its retail brands more
accessible, particularly in markets where it lacks store coverage. Furthermore, the convenience online
shopping offers opens up new revenue channels for its brands. However, the group does not offer click-andcollect, which we believe would enhance the online shopping service considerably.
Company background
1947
1964
1967
1968
1974
1976
1980
1998
2000
2003
2004
2005
2006
2007
2008

Erling Persson opens the first Hennes womenswear store in Vsters,

Sweden. His goal is to develop a clothing store combining high sales
volumes with low prices.
Entry into Norway.
Entry into Denmark.
Hennes buys Stockholm-based hunting and gun store, Mauritz Widforss.
Purchase brings in menswear for first time.
H&M floats on the Stockholm Stock Exchange.
Entry into UK.
H&M begins selling through mail order.
H&M launches a transactional website in its domestic market.
Entry into Spain.
Entry into Italy.
Karl Lagerfeld for H&M collection.
One-off collection by Stella McCartney in November. Pre-Christmas
jewellery collection by Solange Azagury-Partridge.
E-commerce taken outside the Nordic countries for the first time (to the
Netherlands). First stores in the Middle East. Collaborations with Madonna
and Viktor & Rolf.
First stores in China (Hong Kong and Shanghai).
Launch of new format, COS.
Swimwear collection with Kylie Minogue.
Buys 60% stake in private fashion company Fabric Scandinavien AB,
owner of Monki, Weekday and Cheap Monday brands.

This report is supplied in accordance with Mintel's terms and conditions. Supplied to University of Coventry.
Mintel Group Ltd.

2009
2010

2011

2012
2013

2014

2015

Launches H&M Home in seven European countries via internet and

catalogue.
H&M Home launched in the UK. UK online site goes transactional.
Announces collaboration with French design house, Lanvin to offer Lanvin
at H&M womenswear and menswear collections in 200 stores in
November 2010.
Buys remaining 40% of Fabric Scandinavien AB.
Enters the Croatian market.
Autumn Versace range.
Opens first Cheap Monday and Monki-branded standalone stores in the
UK.
H&M collaborates with David Beckham to launch a body wear collection.
First store in South America (Chile).
Malaysia entry.
First store in Estonia opens.
First store opens in Serbia.
Beyonc stars in H&M Summer Collection advertising campaign.
& Other Stories first store, in London.
Monki teams up with online retailer ASOS to distribute its brand
internationally. The fashion label will be available in more than 230
countries worldwide.
Announces plan to launch an updated and expanded sports concept for
women, men and children. The range will consist of sportswear and
accessories in specially developed functional materials suited to various
kinds of sporting activities. The concept will initially be launched in
H&Ms existing online markets as well as in selected H&M stores in 15
countries.
Starts Garment Collecting, becoming the first fashion chain to offer
collection of clothes in stores globally for re-use or recycling.
H&M expands online shopping to the US.
The 3,000th H&M store opens in Chengdu, China, and the first H&M
stores in the southern hemisphere open in Indonesia and Chile.
The largest H&M store in the world opens on Fifth Avenue in New York
City.
Opens its first H&M store in Australia, in Melbourne.
First H&M store opens in India.
Opens first standalone COS store in Dublin.
Reportedly exploring options to launch an all new brand which will be very
different from its namesake H&M brand label as well as sister labels and
current store concepts. H&M chief executive officer Karl-Johan Persson
says the new brand could be launched as soon as 2017.

Company performance
H&M Hennes & Mauritz posted net sales of SEK151,419 million for the year ended 30 November 2014, up
17.8% on the same period a year earlier. The group credited the surge in net sales to well-received
collections, a broader product range, massive store expansion particularly in China and the US where
sales growth is rapid and the rollout of H&Ms online store in four new large markets: China, France,
Italy and Spain.
Profit margins are slipping though, but this is a hit the Swedish clothing giant is prepared to take to ensure
it maintains the low price positioning its customers have become accustomed to. Rather than increase retail
prices, the group is absorbing the rising purchasing and wage costs.
For the first six months of the 2014/15 year of trading, group sales excluding VAT amounted to SEK86,143
This report is supplied in accordance with Mintel's terms and conditions. Supplied to University of Coventry.
Mintel Group Ltd.

million, up 23% on the same period a year earlier. The group said sales had been boosted by the opening of
its first H&M store in Peru and Macau and eight new H&M online markets Bulgaria, Belgium, Czech
Republic, Slovakia, Hungary, Poland, Portugal and Romania.
FIGURE 69: H&M Hennes & Mauritz: Group financial performance, 2009/10-2013/14

Year to November
Sales (SEKm):
H&M Hennes & Mauritz
Of which:
H&M (Poland)
H&M (Czech Republic)
H&M (Austria)
H&M (Romania)
H&M (Belgium)
H&M (Denmark)
H&M (Finland)
H&M (France)
H&M (Germany)
H&M (Luxembourg)
H&M (Norway)
H&M (Spain)
H&M (Sweden)
H&M (Switzerland)
H&M (The Netherlands)
H&M (US)
H&M (Croatia)
H&M (Turkey)
H&M (South Korea)
H&M (Singapore)

2010

2011

2012

2013

2014

108,483

109,999

120,799

128,562

151,419

2,199
591
4,389
N/A
2,765
3,493
2,098
7,642
25,757
365
4,690
5,257
6,742
5,689
6,208
8,490
N/A
26
232
N/A

2,255
603
4,002
267
2,609
3,362
1,948
7,806
24,997
345
4,322
4,968
6,704
5,553
5,885
9,209
215
283
373
104

2,401
642
3,992
512
2,696
3,444
1,987
8,341
25,499
374
4,495
4,917
6,625
5,389
5,608
11,950
488
408
540
383

2,598
691
4,024
720
2,847
3,694
2,054
8,893
26,206
346
4,432
4,997
6,652
5,108
5,581
13,001
564
661
736
573

3,040
802
4,309
1,033
3,255
4,097
2,178
10,271
29,418
345
4,524
5,606
7,184
5,510
6,053
16,429
619
1,219
900
742

H&M (UK)
H&M (Franchise)
H&M (Portugal)
H&M (Italy)
H&M (Canada)
H&M (Slovenia)
H&M (Ireland)
H&M (Hungary)
H&M (China)
H&M (Greece)
H&M (Slovakia)
H&M (Japan)
H&M (Russia)
H&M (Chile)
H&M (Bulgaria)
H&M (Latvia)
H&M (Malaysia)
H&M (Mexico)
H&M (Philippines)
H&M (Lithuania)
H&M (Serbia)
H&M (Estonia)
H&M (Australia)
Sales (m):

7,337
899
778
3,610
2,442
477
443
310
2,340
532
189
1,708
785
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

7,921
1,229
732
3,667
2,491
420
441
397
3,283
621
212
1,476
1,299
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

8,968
1,914
701
4,016
2,802
405
495
492
4,884
685
282
2,385
1,824
N/A
101
30
84
40
N/A
N/A
N/A
N/A
N/A

8,835
2,394
747
4,529
2,713
389
524
625
5,957
799
311
2,804
2,208
232
220
108
379
280
N/A
36
59
35
N/A

11,196
2,947
899
5,852
2,798
406
688
832
8,018
1,081
364
3,134
2,630
294
324
203
677
514
44
178
204
185
417

This report is supplied in accordance with Mintel's terms and conditions. Supplied to University of Coventry.
Mintel Group Ltd.

H&M Hennes & Mauritz

Of which:
H&M (Poland)
H&M (Czech Republic)
H&M (Austria)
H&M (Romania)
H&M (Belgium)
H&M (Denmark)
H&M (Finland)
H&M (France)
H&M (Germany)
H&M (Luxembourg)
H&M (Norway)
H&M (Spain)
H&M (Sweden)
H&M (Switzerland)
H&M (The Netherlands)
H&M (US)
H&M (Croatia)
H&M (Turkey)
H&M (South Korea)
H&M (Singapore)
H&M (UK)
H&M (Franchise)
H&M (Portugal)
H&M (Italy)
H&M (Canada)
H&M (Slovenia)
H&M (Ireland)
H&M (Hungary)
H&M (China)
H&M (Greece)
H&M (Slovakia)
H&M (Japan)
H&M (Russia)
H&M (Chile)
H&M (Bulgaria)
H&M (Latvia)
H&M (Malaysia)
H&M (Mexico)
H&M (Philippines)
H&M (Lithuania)
H&M (Serbia)
H&M (Estonia)
H&M (Australia)
Operating Profit (SEKm):
H&M Hennes & Mauritz
Operating Margin (%):
H&M Hennes & Mauritz
Pre-tax Profit (SEKm):
H&M Hennes & Mauritz

11,360

12,185

13,880

14,866

16,647

230
62
460
N/A
290
366
220
800
2,697
38
491
550
706
596
650
889
N/A
3
24
N/A
768
94
81
378
256
50
46
32
245
56
20
179
82
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

250
67
443
30
289
372
216
865
2,769
38
479
550
743
615
652
1,020
24
31
41
12
877
136
81
406
276
47
49
44
364
69
23
163
144
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A

276
74
459
59
310
396
228
958
2,930
43
516
565
761
619
644
1,373
56
47
62
44
1,030
220
81
461
322
47
57
57
561
79
32
274
210
N/A
12
3
10
5
N/A
N/A
N/A
N/A
N/A

300
80
465
83
329
427
238
1,028
3,030
40
513
578
769
591
645
1,503
65
76
85
66
1,022
277
86
524
314
45
61
72
689
92
36
324
255
27
25
12
44
32
N/A
4
7
4
N/A

334
88
474
114
358
450
239
1,129
3,234
38
497
616
790
606
665
1,806
68
134
99
82
1,231
324
99
643
308
45
76
91
882
119
40
345
289
32
36
22
74
57
5
20
22
20
46

24,659

20,379

21,754

22,168

25,583

22.7

18.5

18.0

17.2

16.9

25,008

20,942

22,285

22,526

25,895

Source: Company Accounts and Annual Report/Mintel

This report is supplied in accordance with Mintel's terms and conditions. Supplied to University of Coventry.
Mintel Group Ltd.

H&M opened a net total of 379 new stores in the year to end November 2014. In 2015, it plans a net total
of 400 new stores, with the greatest expansion taking place in existing markets where there is still potential
to grow further, such as China and the US, where sales leapt 26.4% in 2014 making the US one of the
groups best-performing markets. The vast majority of new stores will be H&M, but the group does plan to
open more COS and & Other Stories stores in 2015 compared to 2014.
Store expansion in fiscal 2014 encompassed all H&Ms brands, with COS debuting in six new markets:
Switzerland, US, Portugal, South Korea, Japan and Australia; Cheap Monday opening its first store in
Paris; & Other Stories opening its first store in Belgium.
At the end of fiscal 2014 H&M Hennes & Mauritz store portfolio consisted of:

H&M in 55 countries, with a total of 3,261 stores

& Other Stories in 10 countries, with a total of 17 stores
Cheap Monday in four countries with five stores
COS in 25 countries with 114 stores
Monki in 12 countries with 92 stores
Weekday in seven countries with 22 stores.

As of 31 May 2015 H&M Hennes & Mauritz had 3,649 stores.

FIGURE 70: H&M Hennes & Mauritz: Outlet data, 2009/10-2013/14

At November
Outlet numbers:
H&M Hennes & Mauritz
Of which:
H&M (Poland)
H&M (Czech Republic)
H&M (Austria)
H&M (Romania)
H&M (Belgium)
H&M (Denmark)
H&M (Finland)
H&M (France)
H&M (Germany)
H&M (Luxembourg)
H&M (Norway)
H&M (Spain)
H&M (Sweden)
H&M (Switzerland)
H&M (The Netherlands)
H&M (US)
H&M (Croatia)
H&M (Turkey)
H&M (South Korea)
H&M (Singapore)
H&M (UK)
H&M (Portugal)
H&M (Italy)
H&M (Canada)
H&M (Slovenia)
H&M (Ireland)

2010

2011

2012

2013

2014

2,206

2,472

2,776

3,132

3,511

76
22
66
N/A
64
87
43
151
377
10
101
122
168
75
112
208
N/A
1
2
N/A
192
21
72
55
11
12

89
24
66
11
66
90
47
168
394
10
104
132
173
80
118
233
6
8
6
1
213
23
87
58
12
15

103
31
68
19
70
94
53
182
406
10
111
146
177
82
124
269
11
11
11
2
226
23
104
61
12
16

122
38
72
28
73
97
58
197
418
10
114
156
177
87
130
305
13
20
16
6
245
27
116
66
12
19

140
43
73
38
78
99
60
205
440
10
118
159
176
93
135
356
14
30
22
10
253
30
132
72
12
20

This report is supplied in accordance with Mintel's terms and conditions. Supplied to University of Coventry.
Mintel Group Ltd.

H&M (Hungary)
H&M (China)
H&M (Greece)
H&M (Slovakia)
H&M (Japan)
H&M (Russia)
H&M (Chile)
H&M (Bulgaria)
H&M (Latvia)
H&M (Malaysia)
H&M (Mexico)
H&M (Philippines)
H&M (Lithuania)
H&M (Serbia)
H&M (Estonia)
H&M (Australia)
H&M (Franchise)
Sales area (000 sq m):
H&M (UK)
Sales per outlet (SEK000):
H&M Hennes & Mauritz
H&M (Poland)
H&M (Czech Republic)
H&M (Austria)
H&M (Romania)
H&M (Belgium)
H&M (Denmark)
H&M (Finland)
H&M (France)
H&M (Germany)
H&M (Luxembourg)
H&M (Norway)
H&M (Spain)
H&M (Sweden)
H&M (Switzerland)
H&M (The Netherlands)
H&M (US)
H&M (Croatia)
H&M (Turkey)
H&M (South Korea)
H&M (Singapore)
H&M (UK)
H&M (Portugal)
H&M (Italy)
H&M (Canada)
H&M (Slovenia)
H&M (Ireland)
H&M (Hungary)
H&M (China)
H&M (Greece)
H&M (Slovakia)
H&M (Japan)
H&M (Russia)
H&M (Chile)
H&M (Bulgaria)

15
47
18
7
10
11
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
50

20
82
22
10
15
19
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
70

26
134
25
13
22
37
N/A
4
2
2
1
N/A
N/A
N/A
N/A
N/A
88

33
205
27
13
39
51
1
11
3
7
3
N/A
2
2
3
N/A
110

35
291
30
15
51
71
1
16
6
18
6
3
6
5
6
3
130

203

225

239

259

267

51,732
31,414
29,550
68,578
N/A
44,597
42,598
52,450
53,441
69,802
40,556
48,854
44,551
41,110
76,878
58,019
42,879
N/A
26,000
116,000
N/A
40,989
38,900
53,088
46,075
47,700
40,273
25,833
63,243
33,250
37,800
213,500
98,125
N/A
N/A

47,028
27,500
26,217
60,636
24,273
40,138
38,205
43,289
49,094
64,927
34,500
42,373
39,118
39,435
72,117
51,174
41,859
35,833
70,750
93,250
104,000
39,213
33,273
46,418
44,482
38,182
33,923
23,353
51,297
31,050
26,500
123,000
86,600
N/A
N/A

46,036
25,010
23,778
59,582
34,133
39,647
37,435
39,740
47,663
63,748
37,400
42,009
35,374
37,857
66,531
46,347
47,610
61,000
45,333
67,500
383,000
40,950
30,478
42,274
47,492
33,750
33,000
21,391
45,222
29,783
25,636
132,500
65,143
N/A
25,250

43,521
23,196
20,324
57,486
31,304
40,099
38,884
37,345
47,053
63,607
34,600
39,571
33,093
37,582
60,810
43,945
45,300
47,000
44,067
56,615
143,250
37,596
29,880
41,173
43,063
32,417
30,824
21,552
35,249
30,731
23,923
93,467
50,182
232,000
31,429

45,594
23,206
20,050
59,847
31,303
43,400
41,806
36,915
51,100
68,573
34,500
39,000
35,707
40,818
61,222
45,856
49,785
47,615
48,760
47,368
92,750
44,964
32,107
47,194
40,551
33,833
36,211
24,471
32,331
38,607
26,000
69,644
43,115
294,000
24,923

This report is supplied in accordance with Mintel's terms and conditions. Supplied to University of Coventry.
Mintel Group Ltd.

H&M (Latvia)
H&M (Malaysia)
H&M (Mexico)
H&M (Philippines)
H&M (Lithuania)
H&M (Serbia)
H&M (Estonia)
H&M (Australia)
H&M (Franchise)

N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
20,907

N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
20,483

15,000
42,000
40,000
N/A
N/A
N/A
N/A
N/A
24,228

54,000
94,750
140,000
N/A
18,000
29,500
11,667
N/A
24,182

50,750
56,417
128,500
14,667
44,500
68,000
46,250
139,000
24,558

Source: Company Accounts and Annual Report/Mintel

Retail offering
Range

The H&M stores carry a wide and varied range of fast fashion and basic
clothing and accessories for women, men, children and babies, from basics
to affordable cutting-edge fashion collections in collaboration with wellknown designers.
COS offers slightly more expensive classic and modern fashion for men and
women, including coats, jackets, knitwear, shirts, trousers, shoes, dresses,
skirts and jewellery.
Women and mens jeans-focused Weekday mixes in-house brands, such as
MTWTFSS Collection and MTWTFSS Weekday, with external brands.
Streetwear fashion chain Monki offers youthful womens clothing and
accessories.
Denim and fashion brand Cheap Monday offers complete collections for
young men and women. Its clothing, which includes dresses, skirts and
jeans, draws its inspiration from alternative music and trends.

Brands
Pricing

Recent activity

& Other Stories is a more upmarket womens retail brand offering clothing,
footwear, accessories and beauty products.
Predominantly in-house brands, including its H&M designer collaborations,
although Weekday carries a few brands such as Birkenstock, Vans and
Rains.
H&Ms pricing strategy is to make cutting-edge fashion affordable. The
groups target market is largely young, fashion-conscious, budget-minded
consumers, although its sister retail brands & Other Stories and COS have a
slightly more upmarket feel, with generally more expensive fashion items.
In August 2015 H&M joined forces with London College of Fashions
Centre for Sustainable Fashion to launch its first nationwide Fashion
Recycling Week from 31 August-6 September. The aim of the initiative was
to raise awareness about sustainability and the extended life clothes have
after theyve been donated.
In July 2015 H&M launched an exclusive pop-up store in the Old Truman
Brewery, in East London, to celebrate its Divided collection. During the sixweek duration of the store, H&M hosted numerous events and activities in
the 1,100 sq ft location for customers to attend, ranging from DJs,
workshops, jewellery designing and complimentary manicures.

This report is supplied in accordance with Mintel's terms and conditions. Supplied to University of Coventry.
Mintel Group Ltd.

This report is supplied in accordance with Mintel's terms and conditions. Supplied to University of Coventry.
Mintel Group Ltd.