STOCKHOLM, March 27, 2025 (BSS/AFP) - H&M reported Thursday weaker-than-expected sales and profits in the first quarter, as discounts and a strong Swedish currency hit earnings at the world's second-biggest fashion retailer.

H&M said net profit fell 53 percent to 579 million kronor ($57.5 million) between December and February -- the first three months of the group's fiscal year.

Sales rose three percent to 55 billion kronor, boosted by women's collections.

"Although we have made important progress in our plan and have good cost control, our sales and earnings in the quarter were somewhat weaker than planned," H&M chief executive Daniel Erver said in a results statement.

"But the first quarter is the smallest quarter of the year for us in terms of sales and margin, and we are confident going forward," he added.

Its profit margin was negatively impacted by "increased markdowns" and a strong krona, the company said.

H&M expects sales to rise one percent in local currencies in March.

"We can see that the improvements we have made, especially in the women's assortment, are starting to have a positive effect," Erver said.

"Here we have simplified the organisation and become faster at adapting to new trends and creating a more relevant assortment."