Swedish fashion chain KappAhl Holding AB today (27 June) reported a 42% jump in third quarter profit after sales rose and it benefited from the end of a real estate lease.

Profit after taxes rose to SEK112m (US$18.7m) or SEK 1.49 per share, from SEK79m or SEK1.05 per share in the same period last year. Profit was boosted by a SEK23m gain from the termination of a real estate lease.

Net sales for the period rose 3.1% to SEK1.14bn from SEK1.106bn a year earlier.

For the three months from March to May, operating profit was up 9.8% to SEK145m, and gross margin rose to 63.8% from 62.3%.

CEO Christian Jansson said the spring fashion market was slightly weaker than in previous quarters, but the company's "continued steady development in such a market is highly encouraging and indicates that KappAhl has a strong offer that appeals to our customers."

He cautioned, though, that global uncertainty "makes it difficult to assess the near future, at the same time as these conditions could also bring new business opportunities for operations of our type."

He said the company has contracts for 56 new stores.