Zara owner's sales disappoint
Inditex owns the Zara fashion chain
Wednesday, 12, Dec 2007 01:22
The Spanish owner of fashion chain Zara has reported lower-than-expected nine-month sales.
In a statement today the world's second biggest clothing retailer, which also owns the Massimo Dutti and Pull and Bear businesses, confirmed its net sales rose by 17 per cent to €6.63 billion (£4.76 billion) in the nine-month period to the end of October.
But the sales figures fell short of expectations, prompting the value of shares in the firm to fall during early trading in Madrid.
Analysts had feared Inditex could be hit by a slowdown in consumer spending in Spain, with the company's home market accounting for 38 per cent of the group's overall sales.
Nonetheless, the company achieved a 30 per cent year-on-year increase in net profit, which climbed to €825 million (£593 million) over the period.
Reports claim the higher-than-expected profit came as a result of Inditex keeping a tight control on costs.
Inditex chief executive Pablo Isla later told analysts the company was not experiencing a drastic change on its trading environment.
"The markets have always been very, very tough,'' he said in a conference call, according to comments reported by Bloomberg.
Indetex, which has recently opened new stores in emerging markets such as Russia and China, confirmed it increased its total selling area by 184,000 square metres between February 1st and October 31st.
The company also said it opened 411 new stores in the nine-month period.