Inditex Group Once Again Jealous Of Competitors.

Spain fast

The giants recorded a third quarter profit exceeding analysts' expectations.

Inditex predicts that gross margin will remain stable in the second half of the year.

And the quarterly profit margin on Wednesday's earnings suggests that it may not be far from getting rid of this problem.

The high-profile Spanish retail giant has recorded a third quarter profit exceeding analysts' expectations after renewing its six week sales results since November 1st.

Sanford Bernstein (Bernstein) analysts believe this indicates that the group achieved 10.5% sales growth in the same store during this period, which is amazing because Inditex is entering this crucial stage of the paction: Christmas holiday season.

But this was not reflected in the stock price, which fell by 2.7%.

Yes

In recent years, the group has been worrying about gross margins, and investors are still unable to relax.

The latest financial statements show that the gross profit margin of the group fell to 59.7% from 60.1% a year ago in the three months ended October 31st.

Inditex blamed this on the recent adverse fluctuations in the currency exchange rate, which brought about 55% to 60% of its products in euros in the vicinity of Spain.

Despite H&M, about 80% of its products are in Asia.

Compared with other fast fashion competitors, Inditex is not too much affected by exchange rate fluctuations, but it still can't escape the exchange rate squeeze.

In addition, Charles Allen of Bloomberg's Bloomberg Intelligence said that a higher proportion of franchising and online sales are relatively less profitable, which may affect profits.

Inditex forward price earnings ratio is 28 times, which is 21 times that of H&M.

Long term strong sales also prove this point.

But relatively strong performance, its performance in terms of profitability is really poor, some analysts said that this profit even artificial fur can not afford to buy.

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According to the official website of Zara, at present, Zara has more than 300 recycling bins in a series of shops in Spain and Portugal and in the United Kingdom, Ireland, Holland, Sweden and Denmark.

This year will increase the recovery point of these countries, and will also start the recovery business in China.

In 2017, Zara will be equipped with recycling bins in Germany, France, Italy, Poland, Greece, Austria, Switzerland, Japan, the United States, Russia, South Korea and Australia.

Zara said that in the next three years, customers will be able to put recycled clothing in all stores around the world.

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Zara parent Inditex SA (ITX.MC) Indo Textile Group and Hennes & Mauritz AB, Hayne and Maurice are the world's first and second fashion retailers respectively. Sales of two companies in 2015 were 20 billion 900 million euros (US $22 billion 200 million) and 180 billion 860 million Swedish kronor (19 billion 700 million US dollars) respectively, with net profit of 2 billion 875 million euro (3 billion 57 million US dollars) and 20 billion 898 million Swedish kronor (2 billion 270 million dollars).

For the fast fashion industry to promote sustainable development, people are increasingly reluctant to pursue the trend. It seems that they are more willing to choose those classic and lasting products. This trend of thought has entered the public eye and has been recognized.

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