Swedish fashion retailer H&M reported on Thursday a slightly bigger rise than expected in December-February operating profit, and predicted March sales would be up 1% in local currencies.
"Towards the end of the quarter our well-received spring collections contributed to a positive sales trend, which also continued into March," CEO Daniel Erver said in a statement.
Operating profit in H&M's fiscal first quarter, which includes the key Christmas shopping period, rose for a third consecutive quarter to 1.51 billion crowns ($162 million) from a year-earlier 1.20 billion and a mean forecast in an LSEG poll of analysts of 1.39 billion, on an organic sales decrease of 1%.
The rival to Inditex in January flagged that local-currency sales in the first two months of the quarter were down 2%.
According to Reuters, H&M said it is closely monitoring developments in the Middle East and the implications for global trade.
"With good flexibility in the supply chain and a low proportion of air freight, there are opportunities to adapt the flow of goods to changed conditions," it said. "Middle Eastern markets account for a small portion of the company’s total sales and the markets are operated through franchise partners."
On February 28, the United States and Israel launched coordinated strikes against Iran. Iran has in response launched strikes against Israel, US bases and Gulf states.
It has attacked vessels and infrastructure throughout the Gulf region and effectively closed the Strait of Hormuz, hitting global supply chains and causing soaring energy costs, raising concern over war-driven inflation and potential impact on consumer demand.
