H&M June comparable sales strongest since September

STOCKHOLM, Sweden - Comparable sales at budget fashion retailer Hennes & Mauritz grew at their fastest pace in nine months in June helped by strong demand for new collections.

Sales at stores open a year or more were up 3 percent in local currencies from a year ago. The mean forecast in a Reuters poll of analysts had been for a 4 percent rise.

Total local-currency sales at H&M, the world's second-biggest apparel retailer after Zara owner Inditex, were up 13 percent.

H&M had already unveiled 14 percent growth in the first 17 days of June, indicating a healthy start to its fiscal third quarter after consumer gloom and bad weather in its main market, Europe, led to more markdowns than planned and a larger profit drop than expected in the second quarter.

Chief Executive Karl-Johan Persson said at the time that new lines, more so than marked-down older items, had sold surprisingly well to date in June. But he cautioned this could be down to pent-up demand after chilly weather held back spring shopping, rather than a rise in underlying demand.

Apparel firms have faced tough times in Europe as the economic downturn and uncertain outlook make consumers hold on tighter to their wallets, and H&M has seen competition toughen in its low-price segment.

H&M, which has the bulk of its business in Europe, did not comment on the data on Monday.

H&M's shares, which are down 3 percent from a year ago but up 6 percent this year, trade at 22.8 times forecast 2013 earnings, closing in on Inditex' 23.4 times multiple, according to Thomson Reuters data.