H&M, JC Penney & Esprit shake international tradingThursday, 21 June 2012
H&M, J.C. Penney and Esprit owned the scene in the international
stock markets on Wednesday, although for vary different reasons. While shares of the second world largest apparel retailer gained nearly 3% after presenting 2 results, JC Penney´s stock reflected the company´s CEO resignation. Esprit´s stock wasn´t indifferent either to its largest stakeholder increasing its participation in the company.
Shares of H&M gained 2.8 % to 236.90 kronor after Europe’s second-largest clothing retailer reported a 23 % rise in second-quarter profit to 5.22 billion kronor ($750 million) as U.S. and Asian sales rose. The average of 14 analysts’ estimates compiled by Bloomberg called for 4.86 billion kronor.
“The year started well and the positive trend continued in the second quarter. In the second quarter we saw strong sales and profitability development, with a profit increase of 23 percent. The spring collections have been well received by our customers as shown by our increased market share in a fashion retail market that continues to be challenging,” summed up Karl-Johan Persson, CEO of the Swedis fashion giant.
The H&M Group’s sales including VAT increased by 12% in local currencies in the first half of te current financial year. Sales in comparable units increased by 3% wile, converted into SEK, sales excluding VAT amounted to SEK 59,491 million, mirroring an increase of 14%. Profit after financial items increased by 16%, upping to SEK 10,754 million, and group profit after tax was SEK 7,958 million or SEK 4.81 per share.
In Wall Street, J.C. Penney stock is tumbling a day after the department store chain announced the sudden departure of Michael Francis, a former top Target executive brought in last October to help redefine Penney's brand. J.C. Penney stock fell 10.1 % by midday Tuesday, nearing its lowest levels in two years. Shares in the American retailer gained ground late Wednesday morning after starting the day down and continued so for much of the morning Wednesday, but by 11:25 a.m. shares were trading at $22.72, up 47 cents from Tuesday's close, a gain of 2.16 %. J.C. Penney stock closed Wednesday at $23.49, up $1.24, or about 5.57 % from Tuesday's close.
Penney's terse statement Monday gave no reason for Francis's exit. As president, he was responsible for marketing a new pricing plan that the company says replaced hundreds of sales events per year with lower prices overall as of Feb. 1. Francis also oversaw merchandising and product development and played a big role in signing up new brands as part of larger plan to transform the company under its new CEO, Ron Johnson.
In Asian markets, Esprit Holdings Ltd., which relies on Europe for most of its sales, gained 2.6 % to HK$10.30. Shares of Esprit also rose after its largest shareholder Lone Pine Capital LLC increased its stake in the clothier. The hedge fund bought 1.39 million shares at an average HK$10.56 apiece on June 13, according to Hong Kong Stock Exchange data.
In general, and according to data gathered by Bloomberg, Hong Kong stocks advanced, with the benchmark index closing at its highest level in a month, amid speculation the U.S. Federal Reserve will take measures to bolster growth and as leaders from the Group of 20 Nations pledged to support Europe in its struggle with debt.