Hennes & Mauritz AB, Europe’s second-biggest clothing retailer, rose the most in more than seven months after reporting higher sales than analysts anticipated for April, marking the best growth since November.
Revenue including value-added tax jumped 17 percent from a year earlier in local currencies, the Stockholm-based retailer said in a statement today. The figure topped the 10.1 percent gain estimated in a survey of analysts by SME Direkt.
“A very strong month’s trading, significantly ahead of year-to-date trends, we suspect partially benefiting from calendar timing,” analysts at Exane BNP Paribas said in a note. The results imply same-store sales growth of 7 percent, they said.
H&M shares had dropped 7.4 percent this year through yesterday as the retailer invested in geographical expansion, new selling formats and online commerce. The Swedish retailer introduced accessories-focused chain & Other Stories last year, added its first store in the Southern Hemisphere and started a U.S. Web-based shop after several delays.
The shares rose as much as 3.3 percent, the steepest intraday increase since Sept. 26, and were up 2.7 percent at 281.5 kronor at 9:18 a.m. in Stockholm.
As comparative figures toughen into the second half of the year, the Exane BNP Paribas analysts said they “fear for downside risk to consensus forecasts, as H&M continue to suffer margin pressure in an increasingly competitive value fashion market.”
The company was operating 3,246 stores at the end of April, up from 2,881 a year earlier.