Inditex Sees Q2 Sales Bounce 7% Compared With 2019

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LONDON — Zara parent Inditex has shrugged off the impact of COVID-19 and is outstripping pre-pandemic sales with second-quarter growth of 51 percent compared with the corresponding period last year, and 7 percent growth versus 2019 on a constant currency basis.

With 99 percent of Inditex brand stores now open, sales have been gaining even more momentum: Inditex said the fall collections have been “very well received” by customers and that retail store and online sales were up 9 percent between Aug. 1 and Sept. 9 compared with 2019. Compared with 2020, those sales rose 22 percent on a constant currency basis.

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In the first six months to July 31, Inditex said net sales reached 11.9 billion euros, 49 percent higher than in the same period last year. Sales in constant currencies grew 53 percent.

The company said online sales in constant currency increased 36 percent compared with the corresponding period last year, and 137 percent versus 2019. The company said it expects online sales to account for more than 25 percent of overall store revenue in the full fiscal year.

Bottom-line growth is also surging: In the first half, EBITDA increased 109 percent to 3.1 billion euros, while EBIT reached 1.7 billion euros. That compares with an EBIT loss of 198 million in the first half of 2020.

Net income in the first half was 1.3 billion euros, compared with a loss of 195 million euros in the first six months of last year.

Inditex said net cash increased by 24 percent to 8 billion euros in the first six months, due to “operating performance and efficient working capital management.”

Inditex said the growth of space in the first half is “in line” with management’s expectations. Openings have been carried out in 27 markets. At the end of the six month period, Inditex said it operated 6,654 stores.

Investments in the 2020-22 period will be around 900 million euros per year. The investment plan includes a digital investment of 1 billion euros over the three-year period.

Inditex is also jumping on the athleisure trend, saying that on Sept. 30 Zara Man will launch the sports collection Zara Athleticz.

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