New markets help Zara owner boost its profits
SPANISH fashion group Inditex, the world’s biggest clothes retailer, posted a 10 per cent rise in net profit in the past quarter yesterday as its growing Asian presence offset gloom in Europe’s retail sector.
Inditex, which owns brands such as Zara and Bershka, beat market expectations with a net €332m (£292m) profit in the past three months as net sales rose 11 per cent to €2.96bn from February to April.
It said sales continued to grow at that rate, which analysts said equates to like-for-like growth of about three per cent, up to 12 June.
Inditex has benefited from buying a large proportion of its garments in Europe and north Africa, where wage increases have been much lower than in Asia, and from its strong presence in fast-growing emerging markets.
Inditex runs 5,154 stores in 78 countries and opened 110 new stores in 29 different countries in the past quarter alone. It intends to open its first shops in South Africa, Taiwan and Peru before the end of the year, it said in its trading update.
Zara will begin selling online in the US in September, while the same month six other Inditex brands launch online in various countries.