Lifestyle And Fashion
H&M, the world’s second most prominent fashion retailer, said it had decided to wind down its business in Russia, joining a growing list of firms exiting the country.
The firm suspended its business in Russia in early March following Moscow’s invasion of Ukraine. Russia was H&M’s sixth most prominent market, and the fashion retailer increased its store count while reducing physical stores in many other markets.
Helena Helmersson, H&M Group’s Chief Executive, said that, given the current situation, the group saw it as impossible to continue H&M’s business in Russia after careful consideration.
The firm intends to temporarily reopen physical stores for a limited period of time to sell its remaining inventory in Russia.
H&M’s complete wind-down is expected to cost about 2 billion Swedish crowns ($191.3 million), of which about 1 billion crowns impact the cash flow.
The total amount will be included as one-time costs in the results for the third quarter.
Since Russia invaded Ukraine, several multinational firms, from fast-food giant Mcdonald’s to home furnishings giant Ikea, have exited Russia after announcing moves to sell their assets and sever partnerships with local businesses.
According to a count by Yale University, over 1,000 foreign companies have quit Russia.