H&M (HNNMY) shares rose more than 5% in early trading in Stockholm Tuesday after the fast-fashion retailer lifted its 2017 growth target after posting full-year sales that were largely in line with analysts' expectations.

H&M said it plans to increase sales by 10% to 15%, in local currency terms, this year while maintaining "continued high profitability" in a competitive marketplace. The Stockholm-based group also said it plans to launch one or two new brands in 2017.

H&M shares traded 5.6% higher by 08:30 a.m. GMT to change hands at Skr249.8 each, trimming their three-month loss to 1.7% against a 1.01% gain for the Stoxx Europe 600 Retail index.

H&M said sales between Dec. 1, 2015, and Nov. 30, 2016, increased 7% in local currency terms and 6% when converted to the Skr192.3 billion ($21.7 billion) total, a figure that was broadly in line with analysts' expectations. Gross profit for the period increased by 2.9% to Skr106.2 billion, the company said, corresponding to a gross margin of 55.2%, down from 57%.

"Our sales increased by 7% in local currencies to SEK 223 billion -- our highest annual turnover to date -- although sales performance was lower than planned, which led to increased markdowns," said CEO Karl-Johan Persson. "This, combined with the fact that the strong U.S. dollar made our purchases more expensive, had a negative impact on our profit development for the full year. However, profits improved in the fourth quarter."

Sales in the company's fiscal fourth quarter increased by 7% in local currency terms and 8% when converted to kronor, the company said, while gross margin in the three months ending in November was 57%, with profit coming in at Skr30 million.

"For fashion retail in general, 2016 was at the same time a challenging year in which various external factors -- including geopolitical events -- had a negative impact on retail trade in many markets," Persson said. "This was particularly visible in France, Germany, Switzerland and Italy as well as in the U.S. and in China. Since these markets represent a large share of our sales, this consequently had a great impact on our overall sales development."