The rapid spread of COVID-19 has been affecting companies and brands all over the world and the extraordinary public measures, taken almost everywhere to slow down the spread of the virus, have caused an unfortunate situation for people, businesses and communities alike.
Amongst them, the H&M Group has announced the closure of 3,441 of the group’s 5,062 stores, a move that has had a significant negative impact on sales so far in March. Stores across the UK, US and Germany, had been temporarily closed last week, while online sales in around 50 markets are still open.
“Dialogue about temporary layoffs has been initiated in several markets and will be followed by further temporary layoffs in other markets that are impacted by the corona situation,” said the group in a statement.
“Globally, this is likely to affect tens of thousands of employees in all parts of the business, although it is not currently possible to specify the exact number. The company is also reviewing the potential need to terminate employment due to the negative impact of the corona situation on the business,” the statement read.
As it stands, full information about the expected economic effects on the current quarter will only be provided on April 3rd.
“Since we on the board of directors presented our original dividend proposal, the market situation has changed drastically. In the light of the current situation and the uncertainty about market developments, the board has today decided to withdraw its earlier dividend proposal of SEK 9.75 per share, approximately SEK 16 billion in total, and is instead proposing to the 2020 annual general meeting that no dividend is paid,” explained Stefan Persson, chairman of the board.
“I am convinced that this is the best decision in this situation to further strengthen the company’s already strong financial position and thereby secure our freedom of action going forward,” he concluded.
Adding to this, CEO Helena Helmersson explained: “We are doing everything in our power in the H&M group to manage the situation related to the coronavirus. The rapid spread of COVID-19 has been affecting companies and brands all over the world and the extraordinary public measures, taken almost everywhere to slow down the spread of the virus, have caused an unfortunate situation for people, businesses and communities alike.