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Zara owner Inditex reports strong Q1 sales, profit growth

By Huw Hughes

8 Jun 2022

Business

Image: Inditex media room

Spanish fashion giant Inditex has reported a surge in sales and net profit in the first quarter of the year.

The group, whose portfolio includes brands Zara, Massimo Dutti, and Pull & Bear, posted a 36 percent year-on-year increase in sales to 6.7 billion euros in the three months to April 30.

Inditex said its spring-summer collections have been “very well received by our customers” as it saw a “significant rebound” in traffic to its physical stores.

It said that strong performance was experienced across all geographies, except for its markets affected by restrictions. In China, 67 stores were subject to lockdowns during the period, four of which remain temporarily closed.

Inditex said its “strong growth” in the US market has continued.

That improvement in physical store sales came with a 6 percent drop in online sales during the quarter.

Surge in profit

Inditex reported an 80 percent increase in net income to 760 million dollars. Meanwhile, EBITDA was up 55 percent to 1.9 billion euros.

It also said it decided to provision all expected expenses for FY22 in the Russian Federation and Ukraine. For that reason, an extraordinary charge of 216 million euros was recorded in its Q1 accounts.

Looking ahead, the group expects a neutral currency impact on sales in FY22 at current exchange rates.

It also expects online sales to exceed 30 percent of total sales by 2024.

INDITEX
ZARA