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Zara’s owner and H & M bounce off pandemic blues By Reuters

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© Reuters. File photo: On November 30, 2021, the building is reflected in the window of a clothing store in Zara, which is part of the Inditex Group of Spain in Bilbao, Spain. REUTERS / Vincent West / File Photo

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By Corina Pons and Anna Ringstrom

MADRID / STOCKHOLM-Sold in Zara-Owner Inditex (MC :) and rival H & M are back above pre-pandemic levels as the world’s top two fashion retailers are embarking on a recovery in demand despite supply chain challenges.

Inditex, the world’s largest fashion retailer, said Wednesday that sales in constant currency increased 10% from 2019 levels in the quarter to the end of October, supported by strong online demand on December 10. He said it continued at that rate.

Swedish rival Hennes and Mauritz (H & M) said sales in local currency were in line with pre-pandemic levels from September to November.

“The recovery continues to gain momentum,” Marcos Lopez, director of Inditex’s capital markets, said in a statement.

As pandemics continue to disrupt some parts of the world’s daily lives, companies are fighting to procure products and raw materials in a powerful global economic recovery.

With brands such as Massimo Dutti, Bershka and Pull & Bear, Inditex produces more than half of its products near its Spanish base and delivers it to consumers faster than its rivals, the worst of the supply chain crisis. I am spared.

The Spanish company reported sales of € 7.3 billion and net income of € 1.2 billion from August to October, the third quarter of the fiscal year, in line with analysts’ expectations.

Online sales for the first nine months of the fiscal year are projected to increase by 124% compared to the same period in 2019, accounting for more than 25% of the total for the full year.

but, Credit suisse (SIX :) Analysts said the company’s gross profit was slightly weaker than expected.

Both Inditex and H & M stocks fell about 2% in early trading.

Inditex has embarked on a change of senior management, with Marta Ortega, daughter of billionaire founder Amancio Ortega, taking office next April.

Pablo Isla, Executive President of Inditex until March 31, said:

“We are completely confident in our unique business model,” he added in an online phone call with an analyst.

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According to H & M, net sales for the fourth quarter from September to November totaled SEK 56.8 billion ($ 6.22 billion).

“Customers appreciate the collection and show that they can buy where, when and how they choose,” he said.

However, the Swedish group said the business continued to be affected by the pandemic.

As of the end of November, about 115 H & M stores are temporarily closed due to regulations, mainly in Austria and Slovakia. At the beginning of the quarter, about 100 were closed, mainly in Southeast Asia.

According to Inditex, all 1,975 stores are currently open.

H & M warned on September 30 that global supply chain disruptions slowed sales growth in September, but Wednesday’s statement did not mention the issue. The company plans to release the entire fourth quarter financial report on January 28th.

($ 1 = 0.8872 euros)

Zara’s owner and H & M bounce off pandemic blues By Reuters

https://www.investing.com/news/stock-market-news/inditex-9month-net-profit-more-than-triples-to-25-billion-euros-2712026 Zara’s owner and H & M bounce off pandemic blues By Reuters

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