Thursday, 19 April 2018

HM annual report 2017

Front page HM annual 2017 report

For the report in full please go here no previous summary has been made due to it being an new investment and to find out more about H&M then please go to analysis of HM 2017.

As most of you already know 2017 was not a spectacular year for H&M. For a long time they have been considered to be one of the crown jewels in Sweden and that shine have decreased lately. I see the fears and worries for the future due to online, increased inventory, is the CEO skilled enough, over exploitation etc. For me H&M have indeed issues but, and to me this is a big but, they are still making money. Sometimes it sounds as if online sales such as Zalando is some "new" threat to H&M. Germany is H&Ms largest market. Zalando was started in Germany and have been around for many years now. This threat is not new I would even stretch myself to state that H&M getting their online business up and running is more of a threat to Zalando. They had that market pretty much to themselves for a long time and from now on H&M will start to take market shares back. I know for a fact that they had over exploitation in Germany that I hope will get sorted out now that focus is slightly removed from growth to actually looking over their costs.

That said 2017 was not a great year. They grew their revenue to 232 billion SEK and the earnings coming out in the end of that funnel was 16.2 billion SEK which was almost 2.5 billion less than last year. Yeah, that is not good.

Income statement of HM 2017

Conclusion: As the stupid contrarian investor that I am I decided to invest in H&M last December which turned out to be too early and then I pushed in more money during February after I had received my bonus. As with every investment I make I of course hope it will be successful. In this case I want to see that due to an additional two reasons: I want it to regain the crown jewel status of Sweden and I love their sustainability initiatives.

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