According to reports, fashion retailer H&M has been hurt by a plunge by its annual net profits, mainly because of the higher purchasing costs from the increasing dollar and markdowns.

After the Tax Sweden based company’s profits were recorded 18.636 billion kronor in the year ending 30 November 2016.

H&M sales were much lower than predicted, relatively because people held off from purchasing new apparel in spring thanks to much colder weather, provoking reductions.

Nevertheless, in the last three months net profits surged by 7% and sales rose.

During the period the top fashion chain endures to swell its global reach.

While announcing the results Karl-Johan Persson, H&M chief executive, said: “During the year, we opened 427 new stores net worldwide and added three new markets, and we also rolled out our online store to 11 additional markets.”

H&M has been persistently developing a strong online presence and was aiming for stores in Kazakhstan, Colombia, Iceland, Vietnam and Georgia, he added.

Furthermore Persson gave the reference to “geopolitical events” which he said had had a adverse bearing on the retail business, predominantly in France, Germany, Switzerland and Italy as well as the US and China.

“Since these markets represent a large share of our sales, this consequently had a great impact on our overall sales development.” Mr Persson said.