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H&M to cut dividend for first time ever

The Sweden-based retailer H&M could cut its dividend for fiscal 2018, Bloomberg reported. This will be the first time since 1974, when H&M shares began trading.

Photo: Victor J. Blue/Bloomberg

The company may cut its dividend 7.5 percent, according to the average estimate of 27 analysts polled by Bloomberg. Only one expert predicts an increased payout for 2018, while 10 await a cut and 16 expect a steady dividend.

The company is trying to keep pace with the development of online shopping, growing inventory levels and fierce competition from the Spanish Inditex (the brands Zara, Bershka, Pull & Bear, Massimo Dutti, etc.).

Usually, H&M distributes at least half of the profits after taxes to shareholders. The company may not have enough money to maintain such a level of payments. Analysts expect the company's profit to drop by about 10 percent this year.

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