H&M sees profits beat forecasts

H&M has been working with designers on limited edition ranges

Swedish clothing firm Hennes & Mauritz (H&M) has reported profits that topped market forecasts, and said it saw sales pick up at the end of last year.

Net profits rose 18% to 3.8bn kronor (£276m) in the three months to 30 November from 3.23bn kronor a year ago.

December sales were up 16% from 2005 levels, and the company said it planned to open 170 new stores this year.

H&M has been broadening its appeal by developing limited editions of clothes by top designers such as Viktor & Rolf.

The chain, which opened 60 years ago and made a name for itself by selling low-cost garments, also plans to start a high-end range and launch home textiles in the autumn.

The company aims to open its first concept store, called Collection of Style, on London's Regent Street in March, with a plan for a further ten outlets later in the year.

The firm will also start a home textile range, including bedding, curtains, towels and cushions, via online and catalogue sales.

Analysts said the move was a good way to boost sales, and H&M shares rose by more than 5% on the earnings news.