H&M is clear with its trading plans in Russia!
The Swedish fast fashion retailer has said that it has decided to initiate a process to shut down its business in Russia.
Not surprising, considering the operational challenges and uncertain future the retailer has been battling ever since the war started between Russia and Ukraine.
Back in March, H&M had announced halting of all its sales in the country.
The clothing retailer has expressed regret over the inability to continue trading under the present circumstances and that many colleagues are affected as a consequence.
Consequently, the only focus now is to ensure a responsible wind down of operations and help support all affected colleagues in the best possible way over the coming months.
As a part of the shutting down process, the plan is to reopen bricks-and-mortar stores for a limited period of time in Russia so as to sell the remaining inventory.
The entire closure process is expected to lead to costs for the H&M group amounting to a total of around 2 billion SEK, of which about 1 billion SEK will have a cash-flow impact.
The full amount will be included as one-time costs in the results for the Q3 ’22.
A reversal of the 353 million SEK in unrealised exchange gains in respect to intra-group receivables in Russian rubles from Q2 ’22 is included in the one-time cost.
Founded in 1947, H&M is known for its fast-fashion apparels for men, women, teenagers and children. It generated US $ 24.8 billion in 2019.
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