Swedish fashion retailer H&M says its sales fell 10 per cent in the fourth quarter as the second wave of the COVID-19 pandemic stalled consumer spending, cutting short a promising recovery seen in the third quarter.
The Stockholm-based company said Tuesday ahead of reporting full fourth quarter earnings in January that sales in the September to November period dropped to 52.5 billion Swedish kronor (USD 6.25 billion) from 61.7 billion kronor a year earlier.
Sales for the full fiscal year, which runs for the 12 months through November, stood at 187 billion kronor, down 18 per cent.
H&M said that the entire year 2020 was marked by the coronavirus pandemic for the company, one of the world's largest budget fashion retailers, though the year took off with "a positive momentum." "The H&M group started the year strongly and with a positive momentum until the first wave of COVID-19 had an impact," the company said in a brief statement.
"Extensive social restrictions involving temporary store closures and large drops in customer footfall to physical stores led to a substantial decrease in sales, particularly in the second quarter." A strong sales recovery followed in the third quarter, continuing for much of the fourth quarter before suffering "a new slowdown as a result of the pandemic's second wave." The company will report its full fourth quarter and 2020 earnings on January 29.