H&M's October Sales Up 14%, Surpasses Estimates

STOCKHOLM, Sweden — Hennes & Mauritz AB's October sales growth exceeded analysts' estimates, giving a boost to shares of Europe's second-biggest clothing retailer.

Revenue including value-added tax increased by 14 percent from a year earlier in local currencies, H&M said in a statement today. That topped the 9.1 percent gain anticipated in a survey by SME Direkt and compares with 8 percent growth in September.

“Sales momentum continues to be volatile, but this result is reassuring against a notably tough German market,” Simon Bowler, an analyst at Exane BNP Paribas, said in a note. “We assume H&M has not been immune there, but has seen sales strength across the remainder of the business.”

H&M is expanding its online business and investing in new concepts as the Swedish retailer faces rising competition from low-cost clothing retailers such as Primark. Higher garment costs will weigh on margins the rest of the year, H&M has said.

The shares traded 1.3 percent higher as of 9:23 a.m., leading gains in the OMX Stockholm 30 index.

By Katarina Gustafsson; editors: Celeste Perri, Thomas Mulier, Paul Jarvis.