Inditex Stock Up On Strong Q1 Results, Q2-to-date Sales Growth

(RTTNews) - Shares of Inditex SA were gaining around 5 percent in the morning trading in Spain after the Zara owner on Wednesday reported higher profit and sales in its first quarter, and proposed a dividend. The Spanish clothing firm also reported a growth of 12 percent in its store and online sales in constant currency between May 1 and June 3.

Looking ahead for fiscal 2024, Inditex expects a stable gross margin, plus or minus 50 basis points, and a negative 2 percent currency impact on sales at current exchange rates.

The company said it continues to see strong growth opportunities, and is developing several initiatives in all key areas for the coming years.

The growth of annual gross space in the period 2024-2026 is expected to be around 5 percent.

Further, in view of the strong future growth opportunities, Inditex said it is implementing a logistics expansion plan in 2024 and 2025.

Inditex also said its Board of Directors will propose to the Annual General Meeting on July 9 a dividend for FY2023 of 1.54 euros per share. The final dividend payment of 0.77 euro per share will be made on November 4.

Further, at the upcoming Annual General Meeting, the Board will propose the renewal of Baroness Denise Kingsmill and the appointment of Belen Romana García as independent board members.

The Board also will propose the appointment of Flora Pérez Marcote as proprietary director. Anne Lange will leave the Board once her tenure expires on July 14.

The Board will propose to the AGM to reduce the mandate of new board members to two years.

In its first quarter, net income increased 10.8 percent to 1.29 billion euros from last year's 1.17 billion euros. Earnings per share were 0.416 euro, up from 0.375 euro last year.

Profit before tax grew 11.1 percent from the prior year to 1.7 billion euros, while EBIT increased 10.3 percent to 1.6 billion euros and EBITDA grew 8 percent to 2.4 billion euros.

Sales went up 7.1 percent to 8.15 billion euros from prior year's 7.61 billion euros. Sales in constant currency grew 10.6 percent.

The Spring/Summer collections have been very well received, it said.

In Spain, Inditex shares were trading at 45.97 euros, up 4.64 percent.

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