H&M, the Swedish clothing multinational, reported that its pre-tax profits dropped almost 90% in the period from June to August. It blamed the drop in profits on a slowdown in consumer spending, and its pullout from its operations in Russia.

During the period, the company’s pre-tax profit came in at $60.9 million, down from $538 million during the same period one year prior, according to the company’s statement.

One of the more significant factors impacting the company’s profits was a one-time cost of $185 million which was produced when the company decided to wind down its Russian operations. The company noted this cost impacted its financial performance significantly, and accounted for approximately half of the company’s loss of profits.

Chief Executive Helena Helmersson said, “The third quarter has largely been impacted by our decision to pause sales and then wind down the business in Russia. This has had a significant effect on our sales and profitability, which explains half of the decrease in profits compared with the third quarter last year.”

The company had announced it would be pulling out of its Russian operations in July, citing, “operational challenges” due to the sanctions arising from the Ukraine conflict. The company later decided to reopen its physical stores in the country for a limited period to sell remaining inventory.

The company noted its European business has also been severely impacted, due to reduced consumer spending as energy prices hit record highs, and inflation soared.

The retailer announced a plan to dramatically cut its costs, which it predicts will result in an annual savings of roughly $177 million, with the savings set to begin to materialize in the second half of next year.