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Despite 6% rise in sales H1 profit slips at Inditex Group
18
Sep '14
Despite sales rising 6% year-on-year, taking into account currency fluctuations, net profit slipped at one of the biggest global marketers of fashion apparel and Spain based Inditex Group in six months ending 31 July, 2014.

In the first half of fiscal 2014, revenue, shaped by exchange rate trends, amounted to €8,085 million, a year-on-year increase of 6%, with growth coming from all geographic markets, Inditex said.

The Inditex Group’s stores and online sales in local currencies rose by 11% from a year ago period in the first half of fiscal 2014, while like-for-like sales growth touched 4.5% year-on-year.

However net profit in the period under review at Inditex, which has fast fashion brand Zara in its brand portfolio slipped to €928 million, compared to €951 million in the first half of fiscal 2013.

Inditex said it created more than 8,000 new jobs worldwide, 1,200 of which in Spain in the period, which it said, was a result of its investment in expanding its corporate facilities, among other reasons.

The apparel marketer opened stores in 40 different countries during the first half of 2014, bringing its worldwide network to 6,460 stores in 88 markets.

During the period, all Inditex’s fashion brands opened flagship stores. Zara rolled out its new store image to include more spacious premises, clean cut architectural lines and advanced environmental measures.

At the end of the first half of fiscal 2014, the Group was operating online stores in 25 markets and Mexico was added on 3 September.

In addition to 21 European markets, the Group sells online in China, Japan, the US, Canada and, now, Mexico.

In the weeks to come, Zara’s online platform is due to go live in South Korea, and it will expand its online offering in China with the opening of its virtual shopfront on Tmall.

The remaining fashion brands of the Group will also soon launch online in Mexico.

Inditex said it will pay a final ordinary dividend and a bonus dividend totalling €0.242 per share before tax, bringing the total dividend paid from 2013 profits to €0.484 per share. (AR)

Fibre2fashion News Desk - India

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