Profits up 32% for Zara owner

The world’s largest clothing retailer, Zara owner Inditex, posted a 32% jump in first-half year profit yesterday, taking market share in its home market Spain and grabbing new customers online and in emerging markets.

The retailer, which runs eight brands including upmarket Massimo Dutti, youth label Bershka and underwear store Oysho, posted net profit of €944m, compared with €905m forecast by banks and brokerages.

“The drivers are certainly there — the rapid rollout of online sales and fast fashion — but even so it’s a spectacular performance,” said Anne Critchlow, analyst at Societe Generale.

The retailer said like-for-like sales at the start of the third quarter to Sept 17 rose 7%.

Inditex has given no guidance so far on its online performance, but internet sales could be boosting growth to the tune of at least 2 percentage points, Societe Generale calculates.

“Online is allowing Inditex to access customers that wouldn’t be near one of its concept stores,” said Ms Critchlow.

Inditex made sales of €7.2bn and earnings of €1.6bn.

The company currently operates seven Zara stores across Ireland.

Reuters