Zara’s owner and H&M recoup from pandemic woes
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Purchases at Zara owner Inditex (MC: ITX) and rival H&M are returning to pre- pandemic levels or better, despite supply chain issues, as the world’s top two fashion retailers ride a resurgence in demand.
Inditex, the world’s largest fashion retailer, said on Wednesday that sales in constant currencies were up 10% from the same period last year in the quarter ending in October, and had remained at that rate until December 10, owing to strong online demand.
From September through November, smaller Swedish rival Hennes and Mauritz (H&M) reported sales in local currencies mirrored pre-pandemic levels.
“The recovery continues to gain momentum,” Inditex’s Capital Markets director Marcos Lopez said in a statement. Companies are scrambling to find products and raw materials in the midst of a strong global economic recovery, even as the pandemic continues to disrupt daily life in some areas of the world.
Inditex, whose brands include Massimo Dutti, Bershka, and Pull & Bear, manufactures more than half of its products in Spain and gets them to customers faster than competitors, avoiding the worst of the supply chain problem.
The Spanish firm recorded revenues of 7.3 billion euros and a net profit of 1.2 billion euros in the third quarter of its fiscal year, which was in line with analysts’ estimates.
It added that online sales were up 124 percent in the first nine months of its fiscal year compared to the same period last year, and that it projected them to account for more than 25% of overall sales for the year.
Story by : Norvisi Mawunyegah