STOCKHOLM (Reuters) – Sweden’s H&M <HMb.ST>, the world’s second-biggest fashion retailer, reported on Monday local-currency sales growth in line with expectations for its fiscal second quarter and said customer satisfaction was improving.
H&M has seen profits shrink and inventories rise in recent years as its core brand has struggled to keep up with the online shift and tougher competition, as well as to react fast enough to demand swings.
While investing heavily in logistics, digital technology and store concepts, and reviewing its mix of stores and brands, H&M has not fully convinced investors it is back on track and shares are still little above the 13-year lows seen in 2018.
It said on Monday local-currency sales including VAT in the March-May period increased 6% from a year earlier, matching the mean forecast in a Reuters poll of analysts.
That was the fourth straight quarter with rising local-currency sales.
“The rapid changes in the fashion industry continue and we can see that our own transformation work is taking us in the right direction, although hard work and many challenges still remain,” the group said.
“As customer satisfaction and sales increase, we have intensified our transformation work even further,” it said.
H&M, whose main rival is market leader Inditex <ITX.MC>, said in a statement net sales excluding VAT were up 11% at 57.5 billion crowns (4.8 billion pounds) in the quarter, just beating expectations for a 10% rise.
H&M is due to publish its full second-quarter earnings report on June 27.
(Reporting by Anna Ringstrom, editing by Johannes Hellstrom and Louise Heavens)