TEX, the Spanish fashion retailer behind Zara and Massimo Dutti, has posted a sharp rise in first quarter earnings amidst volatile conditions and poor consumer demand in Europe.
Sales rose to €3.4bn (£2.8bn) in the three months to 30 April, up 15 per cent on last year while net profit jumped by 30 per cent to €432m, outstripping consensus forecasts by 11 per cent.
Analysts said the retailer was benefiting from producing more of its products in home markets and North America, sheltering it from adverse exchange rates and higher labour costs being passed on from China.
Simon Irwin, analyst at Liberu Capital said Inditex’s “flexible model” centred at its Galacia headquarters where designs can be changed quickly and stock altered has helped it get ahead of competitors.
It opened 91 new stores during the quarter, including its flagship Zara outlet on Fifth Avenue in New York, bringing its total estate to 5,618 at 30 April 2012.
Shares in the group, now Spain’s largest by market value, rose 11 per cent to €75.1 yesterday.