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H&M's Sales Are Up Thanks to Isabel Marant

Things are looking good for H&M, despite its competitors.
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H&M released its fourth quarter earnings for 2013 on Monday and things are looking good for the Swedish high street retailer. Sales rose 13% for the period beginning Sept. 1 and ending Nov. 30.

The period included a couple of big sales boosters: the retailer's buzzed-about collaboration with French designer Isabel Marant, as well as Black Friday. H&M also launched U.S. e-commerce this summer. Still, the sales jump surpassed estimates significantly.

H&M said cold weather contributed to the numbers (shoppers buying coats and other cold-weather items), and actually played down the Isabel Marant success -- Nils Vinge, head of investor relations at H&M, told WWD, "In the total of numbers, of course, that plays a minor role."

As Reuters points out, the success of Isabel Marant for H&M also indicates that H&M shoppers are willing to spend at higher price points -- something the retailer is banking on with its higher-priced offshoot in Europe, & Other Stories. Plus, it may continue to bank on as it pushes for more sustainable and -- potentially -- expensive production.

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One reason analysts projected lower numbers initially was due to competition, including other high street retailers like Zara. While Zara does not release numbers specific to the brand, its parent company Inditex, which also owns Massimo Dutti, saw a boost in sales as well -- about 10% between the beginning of November and Dec. 8. Inditex, however has seen greater improvement in gross margins than H&M.

Meanwhile, teen retailers like Abercrombie and American Eagle, for which high street stores are posing an increasing threat, have continued to post falling sales.