MADRID: Inditex, the world’s biggest clothing retailer and owner of fashion brand Zara, reported improved profitability on Wednesday for the first three months of its financial year despite negative currency effects.
The group also reported strong sales for the first six weeks of the second quarter, up 9 percent in local currencies, as shoppers snapped up items from summer collections including striped maxi skirts and linen dresses at Zara.
Although first-quarter sales reached a record €5.7 billion, negative currency effects meant the quarterly growth rate was 2 percent, lower than rates booked during the financial crisis.
First-quarter sales growth stripping out currency effects was 7 percent.
A strong euro has a negative effect on Inditex’s profitability as the owner of upmarket chain Massimo Dutti and underwear store Oysho generates more than half of its sales in non-euro currencies and then books those sales in euros when reporting results.
Inditex’s centralized sourcing and distribution model also means a large chunk of its costs are in euros.
However, the gross margin increased 68 basis points from the same period a year ago to 58.9 percent of sales despite the euro strengthening around 16 percent from the year-ago period.
First-quarter earnings before interest, tax, depreciation and amortization were €1.13 billion, in line with analysts’ expectations.
The company opened new stores in 36 markets and launched online sales in Australia and New Zealand during the period. However, the number of net stores declined over the three months to 7,448 as the company closed smaller shops to focus on big destination-style stores that complement its online offering.
Zara brand owner Inditex reports margin improvement despite strong euro
Zara brand owner Inditex reports margin improvement despite strong euro
Closing Bell: Saudi main index closes in red at 11,183
RIYADH: Saudi Arabia’s Tadawul All Share Index dipped on Monday, losing 44.79 points, or 0.4 percent, to close at 11,183.85.
The total trading turnover of the benchmark index was SR4.05 billion ($1.08 billion), as 69 of the listed stocks advanced, while 191 retreated.
The MSCI Tadawul Index decreased, down 6.63 points or 0.44 percent, to close at 1,504.73.
The Kingdom’s parallel market Nomu lost 328.20 points, or 1.36 percent, to close at 23,764.92. This comes as 22 of the listed stocks advanced, while 49 retreated.
The best-performing stock was Maharah Human Resources Co., with its share price surging by 7.26 percent to SR6.50.
Other top performers included Arabian Cement Co., which saw its share price rise by 6.27 percent to SR22.71, and Saudi Research and Media Group, which saw a 4.3 percent increase to SR104.30.
On the downside, the worst performer of the day was Arabian Internet and Communications Services Co., whose share price fell by 8.01 percent to SR207.80.
Jahez International Co. for Information System Technology and Al-Rajhi Co. for Cooperative Insurance also saw declines, with their shares dropping by 5.61 percent and 4.46 percent to SR12.79 and SR75, respectively.
On the announcement front, Etihad Etisalat Co. announced its financial results for 2025 with a 7.9 percent year-on-year growth in its revenues, to reach SR19.6 billion.
In a Tadawul statement, Mobily said that this growth is attributed to “the expansion of all revenue streams, with a healthy growth in the overall subscriber base.”
Mobily delivered an 11.6 percent increase in net profit, reaching SR3.4 billion in 2025 compared to SR3.1 billion in 2024.
The company’s share price reached SR67.85, marking a 0.37 percent increase on the main market.
