Inditex Group net sales increased by 7 percent in the first half of 2019 to 12.82 billion euros (14.15 billion dollars) for the first time. In local currencies, the company said, sales growth was 7 percent, while like-for-like sales grew by 5 percent, underpinned by growth across all brands and regions, stores and online. The company added that first-half net profit reached 1.55 billion euros (1.71 billion dollars), up 10 percent including the impact of IFRS 16. Without IFRS 16, Inditex said, profit growth would have been 7 percent.
Commenting on the strong first half, Inditex’s Executive Chairman, Pablo Isla, said in a statement: “The investments we have made in the stores as well as in logistics and technology have been key elements in the development of our customer focused integrated online and offline store platform.”
Similarly, the company added, EBITDA and EBIT, which registered year-on-year growth of 47 percent and 14 percent, respectively, would have increased by 8 percent and 7 percent in the absence of the new standard. The group’s net cash position increased by 13 percent to 6.73 billion euros.
After the start of the second half, Inditex has seen store and online sales in local currencies increase by 8 percent between August 1 and September 8, 2019. The company’s management estimates like-for-like sales growth of 4 percent to 6 percent in FY2019.
At the annual general meeting, Inditex will pay an ordinary final dividend and a special dividend totalling 0.44 euro per share on November 4, 2019, bringing the total dividend to 0.88 euro per share.
The group has continued to open, enlarge and refurbish its network of stores in all geographies and its online platform into new markets. All the group’s formats completed openings across a total of 31 different markets during the first half, complementing the refurbishment and expansion of over 100 existing stores.
During the first half of 2019, Zara.com introduced its online platform in Brazil, the United Arab Emirates, Lebanon, Egypt, Morocco, Indonesia, Serbia and Israel. After the close, in August, Zara inaugurated its online platform in Qatar, Kuwait, Jordan, Bahrain and Oman. It is also due to launch the platform in South Africa, the Ukraine, Colombia and the Philippines during the third quarter.
In all, at the July close, the group had 7,420 stores in 96 markets and the integrated online platform was available in 62 of those. The company said, online stores of Zara, Zara Home, Massimo Dutti, Pull&Bear, Stradivarius, Oysho and Uterqüe are also available in an additional 106 markets without physical stores, with Bershka scheduled to follow suit this September.
Picture credit:Inditex media centre