Burberry, H&M Scale Back Russia Business After Invasion

(Bloomberg) -- Fashion retailers Hennes & Mauritz AB, Burberry Group Plc and Boohoo Group Plc are curtailing operations in Russia after its invasion of Ukraine, with the Swedish clothing chain expressing concern about “tragic developments” there.

H&M is pausing all sales in Russia after shutting stores in Ukraine for safety reasons, it said late Wednesday. Burberry has halted shipments to the country until further notice due to “operational challenges,” according to a spokesman. The U.K. luxury brand has two stores and one concession in Russia, which have remained open for now.

Fashion companies are taking divergent approaches a week after the Russian invasion, with consumer brands like Nike Inc. and H&M swiftly curtailing business while others from Bulgari SpA to Richemont continue to sell their wares.

The online fashion retailer Asos Plc also halted sales to Russia, saying it is “neither practical nor right” to continue doing business there. Asos had already stopped operations in Ukraine after the invasion made it impossible to serve customers there.

The stock plunged 10% in London trading on Thursday. Others took a tumble as well, with H&M dropping as much as 3%.

Asos rival Boohoo, which sells to Russian shoppers via its website, suspended its operations in the country at the end of last week, according to a company spokesperson. Boohoo doesn't have any sales channels in Ukraine. Its shares fell as much as 5.7%.

Beyond concerns about the conflict, doing business in Russia has become difficult for foreign companies. Sanctions are mounting, the ruble is plunging and a number of courier services have stopped deliveries to the country.

The suspension of shipments isn't expected to have a big financial impact on the retailers.

Burberry's exposure to Russia is less than 1% of sales, according to the company's spokesman. Asos said revenue in Russia and Ukraine accounted for about 4% of sales in the last fiscal year. Boohoo's Russian operations are a slice of 5% revenue coming from a group of countries that predominantly includes Australia, New Zealand and Canada.