Zara owner Inditex posts strong profit rise

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The Spanish owner of fashion label Zara said earnings before interest, tax, depreciation and amortisation (Ebitda) in the first quarter of its 2017 fiscal year were 1.1 billion euros, up 17 per cent year-on-year and slightly above forecasts.

Apart from Zara, Inditex also owns Massimo Dutti, Oysho, Bershka, Stradivarius, Pull and Bear, Zara Home and Uterque, and runs 7,400 outlets in 93 countries.

Neiman Marcus reported its fourth consecutive quarterly loss on Tuesday of $24.9m, compared with a $3.8m profit for the three months to April previous year, as like-for-like sales slipped almost 5%.

First-quarter net sales grew 14 percent to 5.57 billion euros from 4.88 billion euros a year ago.

Societe Generale analyst Anne Critchlow said positive currency effects meant she expected profits and margins to rise this year at Inditex.

Company shares were down 1 percent at 36 euros in early trading in Madrid.

Inditex said all its brands increased their worldwide presence as it continued to secure its global dominance of retail fashion. Across the period, Zara began selling online to Malaysia, Thailand, Singapore and Vietnam, with additional plans to include India.

According to the British Retail Consortium, poor weather and "shopper restraint" caused shopper numbers to drop 1 percent year-on-year in May, which marked the first decline in footfall since February.

Almost half of the 7,385 stores the company owns, that operate in 93 markets, post earnings in currencies that are not the euro. Its strongest brand, Zara, has around 2,213 locations, and continues to expand.

Inditex (NASDAQ IDEXY) traded down 1.93% on Monday, hitting $19.79.

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