Sales growth picked up at Swedish budget fashion firm Hennes & Mauritz in May after unusually cold spring weather in Europe had capped growth in previous months. Sales in local currencies rose nine per cent last month from a year earlier. The company is expected to have marked down prices of unsold transitional products partly within the quarter. This is likely to impact gross margins for the second quarter. The May reading indicates monthly like-for-like sales growth of one per cent.
Monthly fast-fashion sales trends are often volatile and influenced by the weather and H&M cited an unusually cold spring in some markets after sluggish sales growth in March and April. H&M’s net sales in March through May, its fiscal second quarter, rose to 46.9 billion crowns from 45.9 billion. There was a one per cent decline in overall clothing sales in Germany, H&M's largest market, in May. Lackluster sales at some clothing retailers also indicate slowing underlying demand in some markets.
H&M is the second-biggest clothing retailer after Inditex, which owns Zara. Inditex beat forecasts with a six per cent rise in quarterly profit, driven by strong sales as fast turnover allowed Zara and other brands to react quickly to unseasonable weather.