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H&M Appoints New CEO in Surprise Move as Profit Margin Falls 

H&M logo is seen on a shop in Riga, Latvia January 30, 2020. (Reuters)
H&M logo is seen on a shop in Riga, Latvia January 30, 2020. (Reuters)
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H&M Appoints New CEO in Surprise Move as Profit Margin Falls 

H&M logo is seen on a shop in Riga, Latvia January 30, 2020. (Reuters)
H&M logo is seen on a shop in Riga, Latvia January 30, 2020. (Reuters)

H&M surprised investors on Wednesday with a new CEO, Daniel Erver, taking the role with immediate effect as the Swedish fashion retailer struggles to boost sales in a fiercely competitive market.

Outgoing CEO Helena Helmersson said she had decided to step down and leave H&M, saying the role has been very personally demanding.

The world's second-biggest listed fashion retailer after Inditex, H&M is aiming to reach an operating margin of 10% this year and has focused on profitability rather than cutting prices.

But H&M has struggled with its price-sensitive customers going to budget-friendly newcomer SHEIN, in addition to competition from Inditex's Zara.

H&M's fourth-quarter operating profit margin fell to 7.2% from 7.8% in the third quarter

Measured in local currencies, H&M said on Wednesday that sales from Dec. 1 to Jan. 29 - the start of its fiscal first quarter - fell by 4%, compared to an increase last year of 5%.

It posted a fourth-quarter operating profit of 4.33 billion crowns ($415.4 million), up from 821 million a year earlier but below the 4.57 billion expected by analysts in an LSEG poll.

The board of H&M proposed an unchanged dividend of 6.50 crowns per share, and said it would ask for authorization to buy back the group's own B shares.

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Sources: Shein Weighs Sale of Less Than 10% of Company in London IPO

A mannequin with a Shein sign stands in an office of a lingerie maker at WeMet Industrial Park, in Guanyun county of Lianyungang, Jiangsu province, China November 25, 2024. REUTERS/Florence Lo
A mannequin with a Shein sign stands in an office of a lingerie maker at WeMet Industrial Park, in Guanyun county of Lianyungang, Jiangsu province, China November 25, 2024. REUTERS/Florence Lo
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Sources: Shein Weighs Sale of Less Than 10% of Company in London IPO

A mannequin with a Shein sign stands in an office of a lingerie maker at WeMet Industrial Park, in Guanyun county of Lianyungang, Jiangsu province, China November 25, 2024. REUTERS/Florence Lo
A mannequin with a Shein sign stands in an office of a lingerie maker at WeMet Industrial Park, in Guanyun county of Lianyungang, Jiangsu province, China November 25, 2024. REUTERS/Florence Lo

Fast fashion retailer Shein is considering asking UK regulators to waive listing rules that require at least 10% of its shares to be sold to the public in its planned London flotation, two people with knowledge of the matter said.
The company is exploring this option to facilitate its IPO, one of the people said, according to Reuters.
If granted, it would likely be the first time that a company in London has been allowed to list below the recent 10% rule.
Singapore-headquartered Shein, which sells $5 tops and $10 dresses mostly made in China, in June filed confidentially with the Financial Conduct Authority (FCA) for a London listing.
However, Britain's financial regulator is taking longer than usual to approve its application, Reuters reported last week.
The people declined to be identified as they were not authorized to speak to the media.
Shein declined to comment.
Shein was valued at $66 billion in a fundraising round last year. A 10% flotation at that valuation would make the IPO worth $6.6 billion. The biggest European IPO this year was perfume and fashion company Puig's $2.9 billion deal, according to Dealogic.
The current valuation of Shein and how much it is looking to raise via the London listing was not immediately known.
London changed its listing rules in 2021 to boost the attractiveness of the venue for companies. It cut the proportion of shares an issuer is required to float to 10% from 25%, reducing potential barriers for large IPOs, the FCA said at the time.
In July, Britain ushered in the biggest reform of company listing rules in more than three decades to help it compete more effectively with New York and the European Union for new issuers.
Shein began to explore a listing on the London Stock Exchange early this year, Reuters reported in May, citing sources. The China-founded company's original plan to list in New York was derailed after opposition from US lawmakers.
Shein is also waiting for China's securities regulator to approve its plans for a London IPO, Reuters previously reported. Its revenues are expected to hit $50 billion this year, up 55% from 2023, according to Coresight Research.