Inditex It recorded a net profit of 2 billion 513 million euros As reported by the company this Wednesday, in the first half of the 2023-2024 financial year (from February 1 to July 31), this represents an increase of 40.1% compared to the same period in the previous year. It broke a record with its results and exceeded analysts’ forecasts.
For this reason, Sales increased by 13.5% and reached 16 billion 851 million eurosIt was a “very satisfactory” development for both in-store and online, with sales up 16.6% at constant exchange rates, with growth across all geographic regions and all formats.
While the gross operating result (EBIT) increased by 15.7% to 4 billion 663 million Euros, the net operating result (EBIT) increased by 30.2 percent to 3 billion 164 million Euros. The pre-tax result increased by 39 percent to 39 million euros. % reached 3,252 million euros.
Gross profit margin increased by 14.1% to 9 billion 801 million euros, reaching 58.2% of sales (+27 basis points compared to the first half of the previous year). Inditex expects a stable gross margin (+/-50 basis points) in 2023.
Inditex has allocated 216 million euros in the first quarter 2022 in the line ‘Other results’ for estimated expenses for the 2022 financial year in the Russian Federation and Ukraine.
“The results during this period show that the talents of our teams reinforce improvements in business model performance. The enduring commitment to creativity, product quality and customer experience, as well as the determined progress in sustainability, form a strategy that takes our business model to a higher level,” said Oscar García Maceiras, CEO of Inditex. he emphasized.
Chairman of the company Martha Ortega He emphasized that its “strong operational performance” continued in the first half, He emphasized that the spring-summer campaign collections were highly appreciated by customers, while being supported by the creativity of his teams and the “good implementation” of the integrated store and online business model.
Between February and July Inditex, Opening in 20 markets It operated 5,745 stores at the end of the period.
Similarly, the net financial position increased by 14.1% in the first half of 2022 to €10 billion 546 million at the end of the first half of fiscal 2023.
Due to the strong operational performance and normalization of supply chain conditions during this period, inventory decreased by 6.9% As of July 31, 2023, compared to the same date in the previous year.
On the other hand, the company underlined that all expense items showed a positive development.
Thus, operating expenses increased by 12.5% on an annual basis. growth sales; Including all lease costs, it’s 220 basis points below sales growth.
In parallel with the solid implementation of its business model, Inditex has experienced strong fundraising. Adjusting for lease payments, generated flows increased by 35.4% and cash from operations increased by 57.4%.
second half of 2023
Regarding the second period, the company emphasized: The collections in the Autumn-Winter campaign were greatly appreciated by its customers.
Thus, between August 1 and September 11, 2023, in-store and online sales at fixed exchange rates increased by 14% compared to the same period in 2022.
“Massive growth opportunities”
Inditex emphasized that it continues to see “huge opportunities for future growth”; Therefore, in the current year, it is making investments to increase operational capacity, achieve efficiency and take differentiation to the next level.
In particular, it predicts ordinary investments Approximately 1.6 billion euros in 2023.
“Our priority is to continually improve our fashion offering, optimize the customer experience, increase our focus on sustainability and retain the talent and commitment of our employees. Prioritizing these areas will support long-term growth,” the company said. He added that “the result is a unique market positioning” which gives the business model “huge potential”.
Inditex has a presence in 213 marketsThe group founded by Amancio Ortega therefore sees “strong growth opportunities”, with a low share of each, and in a highly fragmented sector.
“We continue to forecast a progressive increase in sales efficiency in our stores. Gross growth of space in 2023 will be around 3% and the task of optimizing stores continues. Inditex expects the contribution of space to sales to be positive. We continue to experience a very positive development in online sales and the group’s overall “We expect the same share in its sales to increase,” said the company, adding that it expects an exchange rate effect of -3.5% in 2020 according to current exchange rates. Sales in 2023.