Spanish fashion group Inditex sees its profits grow as fashion sales pick up in most countries. The impact of the confinements in China and the war in Ukraine remains limited for the parent company of Zara and Massimo Dutti,.
The second quarter is off to a strong start
Inditex achieved revenue growth of 36% to 6.74 billion euros in the first quarter, better than before the pandemic. Net profit increased by 80% to 760 million euros. Zara’s parent company sees consumers replenishing their wardrobes after two years of being forced to stay at home. Solid figures, even if they are still slightly below analysts’ expectations.
The fashion group was able to offset rising costs by raising prices. The recovery of European and American markets partly compensated for lost sales in Russia, where the group closed 502 stores following the Russian invasion of Ukraine. The war will cost the fashion group some 216 million euros: Russia was the company’s second largest market, accounting for 10% of sales.
Closures in China are now almost over, reports the fashion company: 67 stores were closed in the first quarter, but now only four of them are closed. The second quarter also got off to a strong start, with organic sales up 17% in the period ending June 5.
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The Spanish fashion group Inditex, parent company of Zara and Massimo Dutti, is seeing its clothing sales pick up in most countries. The impact of the lockdowns in China and the war in Ukraine remains limited.