Stockholm  - Swedish clothes retailing company Hennes & Mauritz's (H&M) first quarter pre-tax profits declined 12 per cent, the group said Thursday, citing some effects due to the economic recession.

The group posted a pre-tax profit of 3.55 billion kronor (438 million dollars) for the period December 2008 to February 2009, compared to 4.05 billion kronor for the first quarter in the previous financial year.

Sales, excluding value added tax (VAT), increased 18 per cent to 23.3 billion kronor, the group said.

The group attributed part of the decline in profits to currency effects.

The company said it opened 13 opened stores worldwide during the quarter including two in Moscow, while three were closed. In all, H&M operated 1,748 stores at the end of February compared to 1,529 for the corresponding December 2007 to February 2008 period.

The group said 22 of the stores were franchises.

In the second quarter it planned to open 74 new stores, mainly in Germany, France, Britain, Italy, Switzerland and Spain, while seven were to be closed.

Future expansion plans include South Korea with the first H&M store scheduled to be opened in Seoul during the spring of 2010.

During the spring of 2010, two stores were to open in Jordan in co-operation with the Alshaya franchise. (dpa)