World

Tuesday 22 July 2014

H&M says June sales off to good start

Published 18/06/2014|08:03

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People stands outside a security barrier and look at dresses in a H&M store on November 23, 2010 in Stockholm, after the launch of a line by Lanvin's Israeli designer Alber Elbaz in 200 H&M stores worldwide, the latest of a string of tie-ups between the Swedish retailer and top fashion designers. For the operation Elbaz designed cocktail dresses with rose-patterning or yellow frills and sharp-tailored party frock numbers, with a democratic price tag of 99 to 149 euros (149-199 dollars), as well as blouses for 19.90 euros. AFP PHOTO / JONATHAN NACKSTRAND (Photo credit should read JONATHAN NACKSTRAND/AFP/Getty Images)

Hennes & Mauritz, the world's second-biggest fashion retailer, said sales in June had gotten off to a good start after reporting second-quarter profits in line with analyst forecasts.

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The Swedish budget fashion company, which competes with the world's biggest clothing retailer Zara-owner Inditex, said on Wednesday its spring collections had been well-received and cited strong sales for other H&M brands such as COS, & Other Stories and H&M Home.

It posted a pretax profit of 7.6 billion Swedish crowns ($1.1 billion) for the March through May period, matching a mean analyst forecast in a Reuters poll.

The group, which has been broadening its product offering and investing in its online business having gotten off to a slow start compared with some rivals, posted a gross margin in the quarter of 60.8 percent - just below an analyst forecast for 61.2 percent.

"We are seeing some of our long-term investments starting to generate revenues such as & Other Stories and our online store in the U.S. and in France," Chief Executive Karl-Johan Persson said in a statement, adding the company would continue to make long-term investments.

H&M, which reported quarterly sales last week, said June sales were off to a good start after a near 20 percent increase in May. It did not provide further details about its June sales.

Last week, Inditex said its sales rose 11 percent in local currencies between Feb. 1 and June 8, accelerating from the 8 percent it recorded in the year to Jan. 31.

H&M said it would launch an extended shoe range this autumn. It plans to roll out in 8 to 10 online markets in 2015 after starting up sites in Spain, Italy and China this autumn.

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