• Strength of dollar drives up costs
  • Full-year profits and sales rise as 413 stores opened in the year
  • Plans to open 425 stores globally this year, focused on US and China

H&M has revealed a strong dollar and mild weather affected profits but the fashion giant said it would continue its global store expansion.

Pre-tax profits in the three months to November 30 slipped to 7.15bn SEK (£589m) from 7.8bn SEK (£640m) the previous year, the retailer said.

H&M said the strength of the dollar drove up costs, hitting its bottom line, and it was also impacted by mild weather in European markets and North America during November.

Total sales in the period jumped 14% to 48.7bn SEK (£3.99bn).

During the full year the retailer opened 413 net new stores. Full-year profits rose 5% to 27.2bn SEK (£2.23bn). Sales in the 12 months, excluding VAT, jumped 19% to 180.9bn SEK (£14.83bn).

The group’s UK division reported a sales rise of 8% in the year.

The UK, where 59 new stores opened last year, was the group’s third largest market after Germany and the US.

Chief financial officer Jyrki Tervonen said: “We are pleased with development in UK and very pleased with Ireland. We still see great potential to grow the UK will market - it will be among our top expansion markets in 2016.”

H&M said it would open 425 new stores globally this year, with China and the US a focus for growth. It will also open stores in three new markets – Cyprus, New Zealand and Puerto Rico.

H&M also plans to launch ecommerce sites in nine new markets – Ireland, Japan, Greece, Croatia, Slovenia, Estonia, Latvia, Lithuania and Luxembourg.

Persson remained tightlipped on any potential click-and-collect plans, saying that e-commerce in every territory was the top priority.

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