H&M chief quits amidst sales slowdown

The chief executive of High Street fashion chain H&M has quit after four years in the role as the firm revealed a slowdown in sales last year including over the Christmas season.

Daniel Erver, who has worked for the Swedish chain for 18 years, will step in to Helena Helmersson's role.

The company's annual profits to November were also below market expectations.

Analysts say the group is lagging behind rivals Zara and Shein.

Shares in H&M dropped 10% following the announcement.

Ms Helmersson said the role had been "very demanding at times", and that she had "mixed feelings" about her departure.

"I am very proud of what we together have achieved during the last years when we have navigated through pandemic, and several geopolitical and macro-economic challenges," she said.

H&M, like the rest of the fashion retail market, is facing a squeeze, said analyst Catherine Shuttleworth, with shoppers spending less on items that are seen as discretionary as they grapple with the cost-of-living crisis.

Inflation - the rate at which prices rise - reached near-record highs in 2023, but is slowing.

"For brands like H&M they find themselves fighting off competition at one end from major players like Inditex brands such as Zara, Pull and Bear and BERSHKA, as well as established retailers like Next, Primark and M&S and at the other end from fast growing online players - most notably, Shein," Ms Shuttleworth said.

Chinese-owned Shein's sales have been on a steep trajectory, after online sales surged during the pandemic. It is expanding in the British market in particular after its recent acquisition of British online retailer Missguided.

Running a business like this was "no easy gig" in the current climate Ms Shuttleworth said, given "concerns around global uncertainty, shipping issues and the volatile nature of consumer spending".

One concern on the horizon is disruption to supply chains, after Houthi rebels began attacking passing ships in one of the world's most popular trading route in the Red Sea.H&M revealed a pre-tax profit of 8.7 billion Swedish Krona (£660m) for the year to November, below analysts' expectations. It said sales in the two months to January were 4% lower compared with last year.

In September, it admitted it needed to do more to improve consistency in clothes sizing, after it faced a backlash over its returns fee for online items.