Store sales rose 9 percent from May 1 to June 7, excluding currency fluctuations, the Arteixo, Spain-based owner of the Zara chain said yesterday. Net sales growth was 8 percent in the first quarter at local exchange rates, while net income fell 16 percent to 184 million euros ($259 million), Inditex also said. The shares advanced to the highest in more than a year.
Spanish consumer confidence rose for a third consecutive month in May as registered unemployment declined for the first time in more than a year, according to official data. Inditex gets more than a third of revenue from Spain, where the jobless rate is still the highest in the European Union. The retailer is increasing market share globally, Chief Executive Officer Pablo Isla said on a conference call yesterday.
Revenue growth was "materially better than we anticipated, and continues to argue for Inditex's sharp outperformance of the Spanish clothing market", Citigroup Inc analyst Richard Edwards said in a note. He rates the shares "buy".
Inditex rose as much as 2.16 euros, or 6.6 percent, to 34.79 euros in Madrid trading, the highest since May 20, 2008. The stock has gained 11 percent this year, while rival Hennes & Mauritz AB advanced 21 percent and Gap Inc rose 27 percent.
