Spanish retailing giant, Inditex, which owns Zara, reports sales growth of 50 per cent in the first quarter of this year, with sales for May 2021 above 2019 levels.
Inditex’s executive chairman, Pablo Isla, said, “Our strategic transformation towards a fully integrated, digital and sustainable model continues to bear results, supported by the commitment displayed by all the people who work at Inditex.”
Sales in the first quarter of 2012 reached €4.9 billion and online sales in local currencies grew by 67 per cent. Net cash reached €7.2 billion by the end of the quarter.
Gross margin expanded to a robust 59.9 per cent “thanks to the implementation of the business model and the efficiencies unlocked by the digital transformation strategy,” the company said in a statement on June 9.
Store and online sales in local currencies between May 1 and June 6 2021 registered year-on-year growth of 102 per cent compared to the same period in 2020, and by 5 per cent compared to 2019. During this trading period, 10 per cent of trading hours were unavailable due to store closures and business restrictions.
Sales were higher across all geographies and every brand despite the fact that 24 per cent of trading hours were unavailable due to lockdowns and restrictions. Some 16 per cent of the group’s stores remained closed at the end of the quarter in addition to other capacity restrictions. In local currencies, revenue was just 11.5 per cent below the level of the first quarter of 2019.
First quarter gross profit amounted to €2.96 billion. Net profit reached €421 million in the quarter, compared with a loss of €409 million in the first quarter of 2020.
Inditex is holding its Annual General Meeting in Arteixo, A Coruna, Spain on July 13. The Board of Directors will ask the company’s shareholders to approve the payment of a total dividend from 2020 profits of €0.70 per share, €0.35 of which was already paid out on May 3. The balance will be paid in November 2021.
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