The second largest global fashion firm H&M has warned it plans to hike prices even further this year.
The Stockholm-based retailer posted pre-tax profit of 4.78bn Swedish crowns ($471m) on Wednesday, surpassing analysts’ expectations. Profit boosted by 33 per cent compared to the same period last year.
The buoyant half-year results came after the fashion group had cut back on discounts.
Prices were likely to go up throughout the rest of 2022, chief executive officer Helena Helmersson told Reuters news agency.
The level of increases would be dependent on the competition in particular markets, she added.
While most of the pandemic restrictions “essentially seem to be over,” H&M cautioned that “many challenges remain.”
The firm added: “Disruption and delays still exist in the supply chain, but are gradually being eased. At the same time, there is substantial inflation.”
An increase in full-price sales and a decrease in markdowns helped H&M boost its operating margin to 9.2% from 8.3% in the second quarter despite higher costs.
H&M boosted its operating margin to 9.2 per cent from 8.3 per cent, even with higher operating costs.
The retailer put this down to more full-price sales and a slowdown of markdowns.
The normalisation of life after Covid restrictions has also driven footfall.
“Sales in physical stores increased substantially while online continues to do well,” Helmersson said.