earnings reports

Zara owner Inditex sees sales recovery

Agence France-Presse

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Zara owner Inditex sees sales recovery

ZARA. An exterior view of Zara on Lexington Avenue in New York City on June 23, 2020.

File photo by Cindy Ord/Getty Images/AFP

Inditex records a net profit of 866 million euros ($1.05 billion) in the 3rd quarter of its fiscal year

Spanish textile titan Inditex, owner of global fashion retailer Zara, posted on Tuesday, December 15, a higher than expected net profit in its 3rd quarter as sales recovered from the disruption caused by the pandemic.

The group, which also owns the Bershka and Massimo Dutti brands, recorded a net profit of 866 million euros ($1.05 billion) in the 3 months from August to October, a 26% drop from the same time last year.

Analysts surveyed by financial information service Factset had expected a net profit of 821 million euros.

Sales reached 6 billion euros, up from 4.7 billion euros on the previous 3 months, the company said in a statement.

But they were still far lower than the 19 billion euros in sales recorded during its 3rd quarter of last year before the pandemic forced the closure of stores around the world.

“These results are the direct consequence of effective management in every area of the company and the ability to react and adapt in an unpredictable environment,” Inditex executive chairman Pablo Isla said in the statement.

The company said 5% of its stores were closed during the 3rd quarter and “trading restrictions” affected 88% of its retail network.

It said a fresh round of restrictions and closures began in mid-October as COVID-19 infections rose in many nations.

In November, 21% of the company’s stores closed and as of now 8% remain shut, the company said.

Despite the store closures, sales in October had reached 94% of their level in the equivalent month of 2019.

Inditex posted a net loss of 409 million euros in its 1st quarter – its first ever — but returned to profit in the 2nd. – Rappler.com

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