H&M, the world's second-biggest fashion retailer, said on Monday it had decided to wind down its business in Russia, joining a growing list of companies fully exiting the country and sending its shares down 1 per cent.
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The company suspended its business in Russia in early March in the wake of Western sanctions against Moscow following its invasion of Ukraine. Russia was H&M's sixth biggest market and the company was increasing its store count there while reducing physical stores in many other markets."After careful consideration, we see it as impossible given the current situation to continue our business in Russia," Chief Executive Helena Helmersson said in a statement.
The entire wind-down is expected to cost about 2 billion Swedish crowns , of which about 1 billion crowns will have a cash flow impact, H&M said. The full amount will be included as one-time costs in the results for the third quarter.The shutdown will affect the company's 170 physical stores in the country and its online sales channels, a spokesperson said.
H&M's biggest rival, Zara owner Inditex, told shareholders last week that it would keep operations suspended for the time being.
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