H&M's March-May sales lag expectations

The unchanged local currency turnover is a slowdown from the previous quarter, as well as from 2022. (AP Photo/Mark Schiefelbein)

Sweden's H&M reported on Thursday unchanged second-quarter sales measured in local currencies, slightly lagging expectations as unusually chilly weather held back demand.

Analysts had on average forecasted a year-on-year rise of 1% after H&M flagged already in late March that cold weather in many key markets was dampening demand for spring and summer styles.

The unchanged local currency turnover is a slowdown from the previous quarter, as well as from 2022.

"Sales in the second quarter were affected by unfavourable weather conditions compared to the corresponding period last year on several of the H&M group's large markets" H&M said in a statement.

Net sales at the world's second-biggest fashion retailer after Zara owner Inditex were up 6% to 57.6bn crowns (€4.96bn) against a forecast 7% rise.

H&M said sales in June, the first month of its third quarter, had got off to a good start. The group in 2022 launched a savings drive after a spike in costs which it has only partly been passing on to cash-strapped customers, and its sales growth has been lagging behind that of Inditex as well as online players such as fast-expanding Shein.

Inditex, which has coped better than H&M in sluggish markets, last week said net sales in its quarter through April were up 13% and, in May, up 16%.

H&M, whose single-biggest market is Germany, is due to publish its full quarterly earnings report on June 29.

Reuters