The Spanish fashion giant Inditexowner of the Zara brand, announced on Wednesday an increase in its net profit of almost 6% in the third quarter, despite the impact of the strong inflation and of the war in Ukraine in your activity.
In this period, which for Inditex ended on October 31 due to the configuration of its fiscal years, the company generated 1,300 million euros (1,381 million dollars) of profits, compared to 1,230 in the third quarter of 2021, and a figure of business of 8,200 million euros.
These results are in line with the forecasts of analysts consulted by the financial information provider Factset, who projected an average profit of 1.3 billion euros, and 8,000 million in sales.
In the first nine months of its tenure -which for the company includes from February 1 to October 31- the low-priced fashion giant accumulated 3.1 billion euros in profits, compared to 2.5 billion in the same period of the previous year. , which represents a “record” for the company, according to Inditex in a statement.
The group’s turnover reached, on its side, 23,000 million euros, exceeding the 19,320 million registered in 2021, thanks to the dynamism of purchases in its stores, as well as internet sales, underlines the world leader in clothing sales for all audiences, ahead of the Japanese Fast retailing (Uniqlo) and the Swedish H&M.
Inditex shares were trading higher on the Madrid stock market (+1.25%) at 08:50 GMT, in a market in slight decline (-0.25%).
“Very demanding environment”
According to the general director of Inditex, Óscar García Maceiras, quoted in the statement, the figures for the first nine months of the 2022-2023 financial year were reached in a “very demanding environment”, in reference to both the escalation of inflation, as well as the effects of the war in Ukraine.
The Spanish group, owner of eight brands including zara, Bershka Y Massimo Duttisuffered the increase in manufacturing and transport costs in recent months, like all its competitors, due to tensions in international markets.
In the first nine months of the current year, Inditex’s “operating expenses” “have increased by 17%” compared to the same period in 2021, according to the note. The group indicates, however, that this rise is less than the growth in sales, which was 19 percent.
The textile company’s results were also affected by the war in Ukraine, which led the group to suspend its activity at the beginning of March in the 502 stores it had in Russia, one of its main markets after Spain.
These closures led the company to make a provision of 216 million euros in the first quarter.
Finally, these 502 establishments will be sold to the Emirati group Daher, owner of the Dubai Mall, one of the largest shopping centers in the United Arab Emirates, according to the agreement announced on October 25.
The Spanish giant -headed since April by martha ortegadaughter of the billionaire and founder of Inditex, Amancio Ortega- affirms that he is facing the results of the fourth quarter with confidence, despite the current complex context.
Between November 1 and December 8, sales of the textile group grew by 12% at constant exchange rates compared to the same period in 2021, both in physical stores and online.
