(Source: Getty Images)
H&M's sales have fallen for the fifth consecutive month (results). The Swedish high street fashion retailer said that a shorter trading month was partly responsible:
Sales in February 2013 were negatively affected by calendar effects of just over 3 percentage points due to the leap day on 29 February 2012.
But the real story is one of currency developments (our emphasis):
In the first quarter, i.e. 1 December 2012 to 28 February 2013, sales increased by 6 percent including VAT in local currencies compared to the corresponding quarter last year. Sales in comparable units decreased by 3 percent. Sales in the quarter were negatively affected by calendar effects of just over 2 percentage points.
Sales in the first quarter converted into SEK increased by 2 percent and amounted to SEK 33,146 m (32,503) including VAT. Sales excluding VAT amounted to SEK 28,392 m (27,832). The difference between the development in local currencies versus SEK is explained by substantial negative currency translation effects as a result of the continued strengthening of the Swedish krona against most sales countries’ currencies.
To illustrate the impact of the currency translation effects: The reported sales figure of SEK 33,146 m, would have been SEK 1.3 billion higher using the same currency exchange rates as in Q1 2012.