PARIS — As the crisis deepens, Hennes & Mauritz has moved to bulk up its liquidity cushion and has secured a fresh, yearlong revolving credit facility worth 980 million euros.
The Swedish fast-fashion retailer said its liquidity “remains good,” and that the group continues to devise “a combination of different financing solutions.”
The new credit facility is renewable for six months, and comes as an addition to a 700 million euro facility secured in 2017 that matures in 2024.
With stores and factories mostly at a standstill throughout Europe and the U.S., companies are scrambling to shore up their finances in hopes they can weather the crisis. H&M said last week it expects to post a loss in the second quarter despite lowering costs by adjusting orders, revisiting rents, opening fewer stores and temporarily laying off tens of thousands of workers. Sourcing costs have declined, the company has said, given the drop off in demand for apparel manufacturing worldwide.
Sales over the month of March declined 46 percent, as the crisis shifted from Asia to Europe and the U.S. In China, where H&M has reopened stores, the company has noted a slow but “good” recovery.
The majority of its stores have been closed since the end of March — 3,788 out of 5,065.