Hennes & Mauritz (H&M), the Swedish fashion giant, bucked the doom and gloom surrounding the retail sector today by reporting a 19 per cent jump in profits and its strongest sales growth for five months.

In the latest sign that the value end of the clothing market could fare better in the present downturn, H&M announced pre-tax group profits of 4.06 billion Swedish crowns (£338 million) for the three months to February, against 3.90 billion crowns a year ago.

Like-for-like sales last month rose by 10 per cent across the business, the world’s third-largest clothing retailer, in the biggest jump since September.

No separate figures were provided for the UK, where the group has 132 of its 1,529 stores.

H&M put its success down to “well composed” collections and a larger online offer but noted that it had been investing more in price promotions over the new year.

In a statement the group said: “The development of the US dollar exchange rate has led to lower buying costs, which has affected gross margin positively.”

The group has hired Kylie Minogue and Madonna for lavish marketing campaigns in the past year to attract shoppers, but analysts assert that its combination of inexpensive yet trendy clothing is striking a chord with shoppers.

T-shirts can cost as little as £3.

H&M’s success comes in stark contrast to stores such as Next, which said this month that its like-for-like sales could plunge by as much as 7 per cent this spring.

Richard Hyman, the independent retail analyst, said: “Hennes has a good proposition that is tightly run, very focused and delivers what it promises.

“There’s a lot of doom and gloom about. There’s no question that 2008 is going to be the toughest year in retailing for an awfully long time, but even in this marketplace it’s possible to do well.”

H&M said that it planned to open 54 more stores in the coming quarter, spread across the UK, the US, Spain, Italy and Germany.

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