Inditex, the parent company of Zara, has reported a 10.1% increase in net income, reaching €2.8bn ($3.08bn) in the first half (H1) of 2024.
Sales during the period rose by 7.2% to €18.1bn compared to €16.85bn in the previous year, with positive results both in-store and online. During the first quarter of 2024, net sales for Inditex were €8.15bn.
In constant currency terms, Inditex's sales grew by 10.2%. This performance was reflected across all of its retail concepts.
The company's gross profit saw a rise of 7.5%, reaching €10.5bn, with gross margin improving slightly to 58.3% - a 19 basis points increase from the first half of 2023.
Earnings before interest, taxes, depreciation and amortisation climbed by 8.1% to €5.0bn, while earnings before interest and taxes surged 11.9% to €3.5bn and profit before tax by 10.6% to €3.6bn.
Inditex CEO Óscar García Maceiras said: “The design and quality of our fashion proposition and the experience we offer our customers are, together with the efficiency and increasing sustainability of our operations, the keys to the solidity of these results. Our fully integrated model continues to generate opportunities for profitable growth across all concepts, regions and channels."
The company's strong operating performance led to robust cash flow generation, with funds from operations before corporate income tax rising by 9% to €4.4bn in H1 2024.
Inditex's net cash position also grew by 3.5% to €10.9bn at the end of the period compared to the previous year.
Operating expenses increased by 6.8%, below the rate of sales growth, demonstrating controlled spending within the company.
Inventory levels were down by 1.7% as of 31 July 2024 compared with the same date in the previous year.
Throughout the first half of 2024, Inditex expanded its presence with openings in 34 markets, bringing its total number of stores to 5,667 by the end of the period.
In the second half of 2024, store and online sales in constant currency from 1 August to 8 September 2024 increased by 11% compared with the same period of the previous year.
Looking ahead, Inditex anticipates a -3% currency impact on sales for the full year but expects a stable gross margin within a +/-50 basis points range.
