Zara-owner Inditex’s nine-month profits rise 9%

Fashion chain Zara shrugs off mild autumn to boost sales. Picture: contributed
Fashion chain Zara shrugs off mild autumn to boost sales. Picture: contributed
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Inditex, the world’s biggest clothing retailer and owner of Zara, posted a 9 per cent rise in nine-month net profit to 2.2 billion euros (£1.85bn) today as sales growth shrugged off unseasonally warm autumn weather.

Items such as velvet dresses, military blazers and mini-skirts helped push sales up 14.5 per cent in local currencies in the nine months to end-October.

The company said that new space in prime locations was on track for the full financial year. In September, Zara opened its first store in Vietnam in Ho Chi Minh City, and in October launched its first store in New Zealand in Auckland.

Over the nine months Inditex opened stores in 50 markets, and now has 7,240 outlets in 93 markets.

Inditex said net sales reached 16.4bn euros, up 11 per cent on the same period of 2015, while same-floorspace sales remained “strong”.

Analysts said the group had continued to shift away from many new store openings as its primary driver of growth, however, instead focusing on large flagship stores in key locations and tying in its successful online business.

Apart from Zara, Inditex’s brands include younger fashion chain Pull & Bear and upmarket label Massimo Dutti. Rivals Abercrombie & Fitch and Gap posted poor results fourth-quarter results last month, and analysts also believe Zara’s biggest competitor H&M will have been hit by the warmer autumn weather as it failed to swap out its collections of cold-weather items to attract shoppers.

Meanwhile, between November and mid-December Inditex’s sales growth accelerated to 16 per cent from a year earlier.

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