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Zara owner Inditex returns to profit in Q2

The owner of the Massimo Dutti and Bershka brands said on Wednesday that 98% of its stores had reopened.

Article originally published by Reuters. Hargreaves Lansdown is not responsible for its content or accuracy and may not share the author's views. News and research are not personal recommendations to deal. All investments can fall in value so you could get back less than you invest.

The owner of fashion retailer Zara, Inditex , returned to quarterly profit in the three months from May to July despite a 31% fall in sales as the coronavirus crisis kept consumers away from city centre shopping districts.

The owner of the Massimo Dutti and Bershka brands said on Wednesday that 98% of its stores had reopened.

In the current quarter, sales in store and online from Aug. 1 to Sept. 6 at constant exchange rates were down 11% from a year earlier.

Inditex reported a second-quarter net profit of 214 million euros ($253 million), beating the 96 million euro mean forecast from Refinitiv's SmartEstimate model, which is weighted towards more recent estimates and higher-ranked analysts.

It saw a 74% jump in online sales in the first half, a trend seen at other apparel retailers as well, as shoppers bought from home with many stores closed and movement restrictions in place.

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Inditex shares closed 5% higher on Tuesday after Swedish rival H&M beat quarterly profit forecasts. The stock is down 24% this year.

For the first half, it reported a net loss of 195 million euros on sales down 37%.

It said it would have reported a profit had it not booked a 308 million euro charge related to its integration of its store and online platforms.

(Reporting by Sonya Dowsett, editing by Inti Landauro and Jason Neely)


Copyright (2020) Thomson Reuters. This article was written by Sonya Dowsett from Reuters and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to legal@industrydive.com.

Article originally published by Reuters. Hargreaves Lansdown is not responsible for its content or accuracy and may not share the author's views. News and research are not personal recommendations to deal. All investments can fall in value so you could get back less than you invest.

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