H&M Profit Drop Beats Estimates As Margin Damage C

September 29, 2011, 7:57 AM EDT inShare E-mailPrint MORE FROM BUSINESSWEEK Volvo designate BPs Svanberg as Chairman to Replace Schweitzer S&P Places 15 Euro Nations on Warning for Credit Downgrade Euro leaders financial Union Pact Leaves Next Step to ECB europiuman CEOs temper out Cash to Germany In Case of Euro Breakup EU Leaders escape Demands for Investor Write-Offs in Bailouts By Armorel Kenna (Updates with analysts comment in sixth paragraph, CEO quote in 11th.) Sept. 29 (Bloomberg) -- Hennes & Mauritz AB, Europes second-largest clothing retailer, reported a drop in third- quarter earnings that beat analysts estimates as the company contained the tint of high cotton wrongs and wages in Asia. Operating kale fell 17 per centum to 4.71 billion kronor ($700 million) in the terzetto months ended Aug. 31, Stockholm- based H&M tell right away in a statement. The fairish of 17 analyst estimates compiled by Bloomberg was 4.35 billion kronor. The gro ss margin contract to 58.6 per centum from 60.5 partage a year earlier, beating the 57.8 percent average estimate. H&M shares rose to the highest in more than a month. In addition to a near doubling in the price of cotton last year, the retailer has also had to manage with high labor expenses in Asia, where it gets about 75 percent of its clothes.

succeeding(a) earnings may benefit from a 54 percent decline in cotton prices since they surged to a record in March. Gross margin is a relief, Jan Meijer, an analyst at ING expert Banking in Amsterdam, said in an e-mail. The market was worried that H&M margi ns would be impacted heavily by higher(preno! minal) cotton prices and wages in Asia. H&M gained as much as 5.7 percent in Stockholm reflect and was up 9.2 kronor, or 4.7 percent, at 205 kronor as of 1 p.m. higher(prenominal) register The third quarter could have been a lot decline from an input be perspective, given higher cotton cost still filtering through to the company, Societe Generale analyst Anne Critchlow said in an...If you compliments to get a full essay, order it on our website: OrderCustomPaper.com

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