Stockholm - Hennes & Mauritz (H&M) reported third-quarter earnings short of analysts’ expectations as the Swedish fashion retailer marked down prices and the strong dollar raised garment costs.
Pretext profit fell to 6.3bn kronor ($730m) in the three months through August from 6.94bn kronor a year earlier, the Stockholm-based company said in a statement on Friday. That compared with an average 6.37bn-krona estimate of 14 analysts surveyed by Bloomberg.
The gross margin narrowed to 54%, compared with the average analyst estimate of 54.3%.
Warmer-than-usual weather early this autumn has weighed on European retailers as consumers delay purchases of warmer outfits.
H&M said in June it expected that the negative dollar effect would raise purchasing costs in the third quarter.
Earlier this month, H&M said its sales in local currency and including value-added tax increased 7% in August, missing the average analyst estimate of 12%.
The company then also reported third-quarter sales excluding value-added tax of 49bn kronor, missing the average 49.6bn-krona estimate.