Zara parent hit by unusually warm weather
Zara owner Inditex has posted slow like-for-like sales growth due to the unusually warm autumn and adverse currency moves.
Inditex, which also owns upmarket label Massimo Dutti and teen label Bershka, posted a 3 per cent rise in like-for-like sales in the six months to the end of November after an “extraordinarily warm September”. Sales bounced back somewhat to 5 per cent in October and November.
The fashion giant reported an increase in earnings before interest and tax of €3.07 billion from the previous corresponding period.
In the first nine months of the year, the world’s largest fashion retailer reported a 3 per cent increase in sales to €18.4 billion and a 4 per cent rise in net profits to €2.4 billion.
According to Inditex, the company didn’t have to cut clothing prices from September like its rivals, which resulted in margin growth of 108 basis points during the third quarter.
The clothing retailer maintained sales and margin guidance for the rest of the year.
Pablo Isla, Inditex chair and CEO, said the group’s strong business model, which continues to deliver solid structural growth in all markets, and its constant focus on developing the integrated store and online platform through continued enhancement of technology and systems, have contributed to its performance.
The company announced last September that all products from all its brands will be made available online by 2020, including in markets where it does not have any stores.
Isla had said that Inditex wants to make all fashion collections available to all customers wherever they are in the world.
“Even in those markets which do not currently have our bricks-and-mortar stores,” Isla added.
Other than Zara, Massimo Dutti and Bershka, Inditex also sells the brands Pull & Bear, Stradivarius, Oysho and Uterque across its network of almost 7500 physical shops. It operates online in 49 markets.
This story first appeared on our sister site Inside Retail Australia.