P2JW17603A-0-B00800-10010B220A0 CMYK Composite

06/25/2010

WE DE,DN,FW,HW,LA,RI,TS,UT

B8 Friday, June 25, 2010

THE WALL STREET JOURNAL.

MARKETPLACE

Bloomberg News

A Hennes & Mauritz sales assistant replenishes stock at an H&M store in London on Wednesday.

H&M Will Stay in China Despite Likely Rise in Costs
BY JOHAN ANDERBERG STOCKHOLM—Hennes & Mauritz AB will be affected by any appreciation in China’s currency but has no plans to move its manufacturing, the Swedish fashion retailer’s chief executive said. “Costs there will probably go up,” Karl-Johan Persson said in an interview Thursday. Analysts estimate that about a third of H&M’s products are made in China, where the government recently signaled that the yuan’s exchange rate will become more flexible. The move is seen as an effort to appease U.S. politicians, who have complained that the weak yuan unfairly boosts China’s competitiveness. “No one knows what is going to happen here,” Mr. Persson said, “but bear in mind that this is just one of many factors affecting our costs. So we see no need to take action.” The Stockholm-based company Thursday posted a 24% rise in net profit for its fiscal second quarter ended May 31 to 5.21 billion Swedish kronor ($670.4 million) from 4.19 billion kronor a year earlier. Revenue rose 1.9% to 27.03 billion kronor from 26.54 billion kronor. However, sales in stores that had been open for more than a year dropped 2%. “There is some cannibalism,” Mr. Persson said, referring to the ferocious speed at which H&M has been opening stores in the past few years. “I don’t know exactly how large that effect is, but it is clear that our same-store sales numbers would have looked a lot better otherwise,” he added. During the quarter, the world’s No. 3 fashion chain by revenue, behind U.S.-based Gap Inc. and Spain’s Inditex SA, opened 86 stores and closed 12. In the third and fourth quarters, H&M expects to open 180 stores, mostly in Germany, the U.S., U.K., France, China and Italy. Mr. Persson, who is 35 years old and the grandson of H&M’s founder and son of the majority owner, took over at the helm of the retailer a year ago. He said he was very pleased with sales in Asia and also singled out Russia, where H&M plans to open up a flagship store on St. Petersburg’s Nevsky Prospect later this year. Positive numbers from U.S. stores also keep coming in, albeit against weak year-earlier sales, he said. In Europe, meanwhile, the picture is more patchy. “Ireland and Greece still look bad,” said Mr. Persson, but he added that there were improvements in Italy and Portugal, two countries that have also be struggling with huge fiscal deficits. “A lot of countries will have to tighten their budgets, and, of course, that will affect consumption,” Mr. Persson said.But despite overall consumption being lower than it was in 2007, H&M has managed to steadily increase its sales. “People are shopping less but we sell more,” Mr. Persson said. “That’s a good combination.”

WEATHER WATCH
Shown are today’s noon positions of weather systems and precipitation. Temperature bands are highs for the day.

AccuWeather.com
Today Hi Lo W 72 74 73 76 71 74 49 49 57 59 53 62 pc pc s s pc t Tomorrow Hi Lo W 64 71 68 72 66 78 46 48 55 61 56 62 pc pc c t c t

Edmonton Vancouver Calgary Seattle Portland Eugene Boise Pierre Reno Sacramento San Francisco Las Vegas Los Angeles San Diego Salt Lake City Cheyenne Denver Colorado Springs Santa Fe Albuquerque El Paso Mpls./St. Paul Sioux Falls Toronto Detroit Milwaukee Helena Billings Bismarck Winnipeg

50s 70s 60s

<0 0s 10s 20s Montreal Augusta Boston Hartford New York 30s 40s 50s 60s 70s 80s 90s 100+ Warm Cold Stationary Showers Rain T-storms Snow Flurries

International Forecasts
Canada
City Calgary Edmonton Montreal Toronto Vancouver Winnipeg

Asia/Pacific
City Bangkok Beijing Hanoi Hong Kong Jakarta Karachi Manila Melbourne Mumbai New Delhi Seoul Shanghai Singapore Sydney Taipei Tokyo 90 98 90 89 89 90 90 59 91 111 93 82 84 68 90 80

Today Hi Lo W 79 72 80 81 78 83 80 43 82 88 68 69 79 48 78 72

Tomorrow Hi Lo W

Europe
City Amsterdam Athens Berlin Brussels Budapest Copenhagen Dublin Edinburgh Frankfurt Geneva Istanbul Lisbon London Madrid Milan Moscow Nice Paris Prague Rome St. Petersburg Stockholm Vienna Warsaw Zurich 74 81 73 75 75 73 70 67 75 78 73 83 79 90 81 86 79 83 73 81 85 70 74 73 78

Today Hi Lo W 57 66 57 57 61 53 52 58 60 56 62 63 59 64 64 63 65 60 57 63 68 52 62 56 56 pc pc s sh sh pc pc pc sh pc c s pc sh t s s s sh s t sh sh c sh

Tomorrow Hi Lo W 72 84 79 77 85 70 68 67 85 80 78 82 79 88 82 84 77 85 78 82 86 66 76 77 78 56 69 56 59 58 53 54 56 63 57 64 61 59 64 65 62 65 63 56 64 58 50 61 53 53 pc pc s pc s pc pc sh s s pc pc pc pc s s s s pc s t sh t pc t

Ottawa Albany Buffalo

80s

Des Moines Omaha Topeka

Chicago Springfield

Cleveland Pittsburgh Philadelphia Indianapolis Washington D.C.

Latin America
Bogota Buenos Aires Caracas Lima Mexico City Rio de Janeiro Santiago Sao Paulo 65 59 83 72 77 81 59 79 47 45 72 59 55 69 37 58 r s t s t s pc s 64 59 85 71 79 78 55 73 47 48 73 58 55 66 30 58 r pc t s t s c pc

100s
Phoenix Tucson

40s 50s 70s 60s
Anchorage Cabo San Lucas

Charleston Richmond Kansas St. Louis Louisville City Wichita Nashville Charlotte Raleigh Oklahoma City Memphis Little Rock Columbia Atlanta Birmingham Dallas Ft. Worth Jackson Mobile Jacksonville 90s Austin Orlando New Orleans Houston San Tampa Antonio Miami Monterrey

t 90 79 t s 95 72 s t 93 81 sh t 88 81 t r 86 78 r s 92 84 s t 85 78 t r 53 39 pc r 92 82 sh s 112 90 s s 82 67 sh pc 82 69 s sh 88 79 sh c 67 44 r r 92 79 r pc 83 72 sh

Africa/Middle East Caribbean
Barbados Havana Kingston Port-au-Prince San Juan 87 88 88 88 90 78 76 80 77 77 sh r t sh sh 87 89 87 91 88 78 75 80 78 77 s r r t sh Baghdad Cairo Jerusalem Johannesburg Riyadh Tehran 102 94 77 71 102 92 69 71 59 40 77 71 s s s s s s 103 94 77 75 101 94 70 72 56 37 73 76 s s sh s s s

Weather Delays
Weather and forecast weather-related delays at major airline hubs. Check most updated schedule with airlines. Legend: Allday delays possible (AD); Morning delays (AM); Evening delays (PM)

U.S.
Atlanta Chicago Dallas/Ft. Worth Denver Mpls./St. Paul New York San Francisco

Honolulu Mexico City

Ice

U.S. Forecasts
High-low forecasts and general weather conditions. s...sunny;pc... partly cloudy; c...cloudy; sh...showers; t...thunderstorms; r...rain; sf...snow flurries; sn...snow; i...ice
City Albany Albuquerque Anchorage Atlanta Austin Baltimore Boise Boston Today Hi Lo W 82 89 66 94 92 90 81 80 57 66 54 74 72 67 54 62 s t sh t pc pc pc s Tomorrow Hi Lo W 77 95 63 92 96 93 82 76 63 65 56 74 73 70 54 64 t t pc t s pc s t City Buffalo Burlington Charlotte Chicago Cincinnati Cleveland Dallas Denver Detroit Honolulu Houston Indianapolis Kansas City Las Vegas

Today Hi Lo W 78 76 94 86 88 82 98 95 84 87 94 88 96 103 56 57 73 69 66 63 78 65 67 74 76 67 77 77 s s t s s s t t s s t s s s

Tomorrow Hi Lo W 78 68 92 91 95 89 97 95 86 88 95 94 95 103 62 57 70 72 71 72 78 56 70 74 77 74 75 78 t c t t s t s t t s s s s s

City

Today Hi Lo W 76 52 76 81 67 69 69 78 71 74 76 76 68 79

Tomorrow Hi Lo W 76 62 78 79 70 71 76 78 74 76 73 77 73 79 pc pc t t t t s pc s pc t t pc s

City Pittsburgh Portland, ME Portland, OR Sacramento St. Louis Salt Lake City San Diego San Francisco San Jose Santa Fe Seattle Sioux Falls Tucson Wash., DC

Today Hi Lo W 83 78 70 90 90 90 67 68 77 86 67 86 104 90 61 55 53 58 76 59 61 52 56 56 52 69 73 72

Tomorrow Hi Lo W pc t pc s s s pc pc s t pc t s pc

Weather t s t t t s pc

Delay PM NO PM AD AD NO AD

International Weather
Hong Kong London Paris Singapore Sydney Tokyo Vancouver t pc s sh c pc pc

Delay AD none none PM none none none

Little Rock 96 Los Angeles 77 Memphis 94 Miami 90 Milwaukee 84 Mpls./St. Paul 86 Nashville 92 New Orleans 94 New York 87 Oklahoma City 98 Omaha 94 Orlando 94 Philadelphia 89 Phoenix 109

t 98 pc 77 t 96 t 90 pc 83 t 88 t 97 t 94 s 86 s 97 s 97 pc 94 s 94 pc 107

s 86 65 s 73 58 pc 74 56 s 95 61 s 97 79 pc 87 58 pc 68 63 pc 73 56 s 81 60 t 94 55 pc 69 55 s 90 65 s 104 70 pc 93 75

Events Forecast
VIVA ELVIS & LEGENDS OF ROCK & ROLL RACE TO THE TASTE

Richmond, Va. A whole lotta shakin’ going on at Virginia Beach boardwalk Saturday Hi/Lo: 97/74 Sunday Hi/Lo: 99/77

Chicago Work up an appetite to the finish line Sunday Saturday Hi/Lo: 91/72 Sunday Hi/Lo: 91/68

P2JW17603A-0-B00800-10010B220A0

Composite

MAGENTA BLACK CYAN YELLOW

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