Shares of Swedish clothing giant Hennes & Mauritz AB, also known as H&M Group, saw a significant rise of 14% in morning trading in Sweden on Wednesday. This is due to the company reporting a substantial increase in their first-quarter profits, even though its net sales were less than expected.
In terms of its recent trading activity, H&M reported a 2% raise in sales from March 1 to 25 in local currencies.
Additionally, H&M announced that its nomination committee has proposed the election of Helena Saxon to the board of directors. The committee also recommended the re-election of Karl-Johan Persson as board chair.
Their annual general meeting, slated for May 3, will consider matters including the board's proposed dividend of 6.50 Swedish kronor per share, which will be disbursed in two instalments.
The first-quarter results saw H&M's post-tax profits rising to 1.20 billion kronor, more than doubling from the previous year's 540 million kronor. The earnings per share were 0.75 krona, up from 0.33 krona a year ago.
Operating profit rose to 2.08 billion kronor, a hefty increase from last year's 725 million kronor. The operating margin spiked to 3.9%, a significant growth from a 1.3% margin a year ago.
The company's gross profit climbed 7% to 27.67 billion kronor from last year, and the gross margin escalated to 51.5%, up from the previous year's 47.2%.
However, the H&M group's net sales fell to 53.70 billion kronor from the previous year's 54.87 billion kronor.
Nevertheless, H&M shares traded at 175.10 kronor in Stockholm, rising by 13.48%.
