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☆ World shares muted, lira plunges to record low
▼ + stars: | 2023-06-07 | by ( Samuel Indyk | ) www.reuters.com time to read: +4 min

Meanwhile, Turkey's lira plunged to a record low against the greenback as authorities appeared to loosen stabilising measures after the government signalled a pivot to more orthodox policies. Spanish stocks (.IBEX) outperformed after shares in the world's biggest fast fashion company Inditex (ITX.MC) jumped almost 7% following first quarter results. That left the MSCI's broadest index of world shares (.MIWD00000PUS) up just under 0.1% but close to its highest level in 13 months reached on Monday. The dollar fell 0.1% against a basket of currencies, while the Turkish lira weakened over 7% to a record low of 23.17 per dollar, its biggest one-day sell-off since the 2021 crash. Bitcoin was trading at about $26,900, consolidating after a sharp rebound on Tuesday from as low as $25,350.

Persons: Ben Laidler, Ipek Ozkardeskaya, eToro's Laidler, Laidler, Solana, Samuel Indyk, Kevin Buckland, Xie Yu, Robert Birsel, Louise Heavens Organizations: REUTERS, Staff LONDON, U.S, Federal Reserve, greenback, Nikkei, Fed, Wall, ICE, Treasury, Swissquote Bank, Data, Saudi, Brent, Texas, U.S . Securities, Exchange Commission, SEC, Thomson Locations: Frankfurt, Germany, Asia, Pacific, Japan, Hong Kong, Taiwan, U.S, London, Turkish, China, Cardano, Polygon

In-store and online sales rose 13% to 7.6 billion euros in the first quarter, in line with the 13.5% seen in the first six weeks of the financial year. The company said it plans to invest 1.6 billion euros to increase gross store space in 2023 by about 3%. Inditex closed its over 500 stores in Russia in March 2022 following Moscow's invasion of Ukraine in February and subsequent Western sanctions. Inditex has begun to charge for online returns in more countries with no impact on sales, the company said. Inditex is also invested in more self-scanning checkouts and is replacing hard anti-theft tags with chips sewn into garments to avoid checkout queues.

Persons: Inditex, Massimo Dutti, Anne Critchlow, Jelena Sokolova, Zara, Corina Pons, Helen Reid, Charlie Devereux, Matt Scuffham, Josephine Mason, Elaine Hardcastle Organizations: Spain Company, Societe Generale, Inditex, Group, Morningstar, Thomson Locations: Spain, MADRID, LONDON, Zara, United States, Mexico, Saudi Arabia, U.S, Europe, Russia, Ukraine, UAE, France, Germany

☆ Spanish stocks outperform as Inditex jumps
▼ + stars: | 2023-06-07 | by ( ) www.reuters.com time to read: +1 min

June 7 (Reuters) - Spanish stocks rose on Wednesday after Zara-owner Inditex's strong quarterly showing, while its European peers lagged as luxury companies and miners dipped after weak China trade data. The pan-European STOXX 600 index (.STOXX) edged 0.2% lower, while Spain's IBEX 35 index (.IBEX) gained 0.6%, as of 0712 GMT. Inditex (ITX.MC) rose nearly 4% after it said sales of its spring-summer collection jumped by 16% over the past month. European retailers (.SXRP) jumped 2.2%, leading sectoral gains, while miners (.SXPP) shed 0.7%. Worries also remained of further interest rate hikes by major central banks, including the European Central Bank and U.S. Federal Reserve next week, in the face of slowing economic growth.

Persons: Shreyashi Sanyal, Sonia Cheema Organizations: European Central Bank, U.S . Federal Reserve, Thomson Locations: Zara, China, Bengaluru

Net profit came in at 1.2 billion euros ($1.24 billion) for the quarter that ended in April, exceeding analysts' average expectations of 980 million euros in a Refinitiv poll. Inditex reported solid sales, in line with analyst expectations of 7.56 billion euros, even after selling its profitable Russian division in 2022 and absorbing higher labour costs. Part of Inditex's strategy, which also owns Pull&Bear and Massimo Dutti, is to maintain higher prices outside the Eurozone. STEADY MARGINSThe gross margin reached a record 60.5%, showing it has been able to pass on higher prices to shoppers. Analysts believe only the strongest global fashion retailers will gain market share in an environment where consumers are becoming more discerning.

Persons: Inditex, Massimo Dutti, Corina Pons, Helen Reid, Charlie Devereux, Matt Scuffham, Josephine Mason Organizations: Thomson Locations: MADRID, LONDON, Zara, Spain, United States, Mexico, Saudi Arabia, U.S, Europe

HONG KONG, June 5 (Reuters Breakingviews) - Shein is threading the world’s trickiest geopolitical needle. But rising American pressure is forcing it to tweak its business model right as it tries to list there. Last year, its top line surged 46% to $23 billion, per the Wall Street Journal, surpassing $22 billion at H&M and outpacing the 18% growth at Inditex. A Boston Consulting Group report notes that this model allows Shein to keep inventory turnover at just 40 days. That will be expensive; the company's net profit margin was a razor-thin 3.5% last year, according to the Wall Street Journal, far below bricks and mortar rival Inditex's 13%.

Persons: Shein, Bernstein, Chris Xu, Xu, Mubadala, Pete Sweeney, Katrina Hamlin Organizations: Reuters, U.S ., Rivals, Street, Financial Times, Boston Consulting, Morningstar, Securities and Exchange Commission, Wall Street, ’, Singapore, Sequoia Capital, General Atlantic, Thomson Locations: HONG KONG, Zara, China, Inditex, Guangdong, U.S, Xinjiang, Nanjing, Singapore, Mexico, Brazil, India

☆ Russian clothing brands plug gap left by Western rivals
▼ + stars: | 2023-05-31 | by ( Roman Churikov | ) www.reuters.com time to read: +3 min

[1/2] People line up to enter an H&M store, which was reopened to sell the remaining stock before the company exits the Russian market, in Moscow, Russia August 2, 2022. Spain's Inditex (ITX.MC) has sold some of its more than 500 Russian stores to a UAE-based buyer. Gloria Jeans, once a re-seller of Levi's jeans, has taken over Swedish retailer H&M's central Moscow store. Russians have developed solutions with small-scale imports and online sellers helping to keep foreign brands alive, but some things remain difficult to find. Shopper Irina Nikulina said she did not miss foreign brands too much, except when needing something simple, like a reasonably priced white t-shirt.

Persons: Maxim, Spain's, Anton, Antonina, Oleg Klimov, Gloria Jeans, Ksenia Zhdanova, Zhdanova, Irina Nikulina, Tatiana Vakhonina, Roman Churikov, Lev Sergeev, Alexander Reshetnikov, Alexander Paramoshin, Alexander Marrow, Mark Potter Organizations: REUTERS, Reuters, Russia's, Shopping, Thomson Locations: Moscow, Russia, Ukraine MOSCOW, Ukraine, UAE, Zara, Soviet Union, Kazakhstan

☆ Ending the retailers’ crisis has a high price tag
▼ + stars: | 2023-05-02 | by ( Aimee Donnellan | ) www.reuters.com time to read: +5 min

BARCELONA, May 2 (Reuters Breakingviews) - High-street retailers are facing a heavy bill to weather the cost-of-living crisis. The cost of heating stores and staff requests for pay rises are squeezing operating margins at top players like H&M (HMb.ST) and Next (NXT.L). Shrinking disposable income is making it hard for these retailers to boost sales to protect margins. Most bricks-and-mortar retailers trade on higher multiples than they did before the war in Ukraine sparked soaring inflation. But that leaves a squeezed middle of retailers like H&M exposed to the brunt of the retail crisis.

☆ Retailers to tackle sustainability at key conference
▼ + stars: | 2023-04-24 | by ( ) www.reuters.com time to read: +3 min

They will discuss the challenges facing their businesses as inflation causes consumers in Europe and elsewhere to reduce spending. The European Commission is drawing up new rules on textile waste that will make companies responsible for managing the waste their products create. Decathlon, the world's biggest sporting goods retailer, sells repair services, spare parts and tools for people to repair their own bicycles, tents, and kayaks. Retailers are working with local authorities ahead of an EU law that will require member states to separately collect textile waste by Jan. 1, 2025. Firms including Decathlon, Mango, Inditex, and IKEA recently created an association in Spain for the management of textile waste.

Amancio Ortega set up the first Zara store in A Coruna in the north west of Spain in 1975. Marta Ortega started from the bottom at Inditex, stacking shelves at a Bershka store when she was 23. Ortega, whose father owns 59.3% of Inditex, has mainly worked in the background, leaving the spotlight to the CEO. "We feel that Marta Ortega has repositioned Zara slightly upwards," said Patricia Cifuentes, analyst at the investment banking arm of Spanish investment firm Bestinver. "Reinforcing that Zara sells fashion, not just clothes, has allowed Inditex to increase prices and protect the margins amidst the inflationary storm."

☆ Zara founder buys luxury apartment building in Dublin for $108 million
▼ + stars: | 2023-03-31 | by ( ) www.reuters.com time to read: +1 min

MADRID, March 31 (Reuters) - Spanish billionaire and Zara founder Amancio Ortega has bought a luxury residential building with 120 apartments for rent in Dublin, Ireland, for around 100 million euros ($108 million), his private firm Pontegadea said on Friday. It is the first residential building that Ortega's firm has bought outside the United States, Pontegadea said, adding it was part of its strategy to invest in multiple real estate assets. The Opus 6 Hanover Quay building is at the heart of Silicon Docks, the nickname for Dublin's business and technology district, and offers luxury apartments and townhouses for long-term rent, according to the building's website. Pontegadea has focused on investing in real estate assets worldwide and in Spain's energy infrastructure. ($1 = 0.9189 euros)Reporting by Corina Pons Editing by David Latona and Mark PotterOur Standards: The Thomson Reuters Trust Principles.

Operating profit in the Swedish group's fiscal first quarter was 725 million Swedish crowns ($69.73 million) against a profit of 458 million crowns a year earlier. H&M's operating profit margin was 1.3%, up from 0.9% a year earlier. Helmersson said the company expects a gross margin recovery over the year and is making progress towards its goal of a 10% operating margin next year. Analysts at Credit Suisse said it would be "very challenging" for H&M to return to a 10% margin in 2024. H&M said net sales for March were expected to increase by 4% in local currencies compared with the corresponding period last year.

☆ Investors punish Zara owner Inditex over spending plans
▼ + stars: | 2023-03-15 | by ( Corina Pons | ) www.reuters.com time to read: +4 min

As the cost of making garments increased, H&M took a profit hit while Inditex was able to pass on costs to shoppers. But higher expected capital expenditure for 2023, of 1.6 billion euros, surprised investors, sending Inditex shares down more than 5% by 1140 GMT. An Inditex logo is seen at the entrance of a Zara factory, the headquarters of Inditex group, in Arteixo, northern Spain, March 9, 2016. Inditex closed stores in mainland China at double its average rate, shutting a fifth of its shops there in 2022. Meanwhile Inditex plans to continue expanding in the United States, with at least 30 new projects planned from 2023 to 2025.

☆ Zara owner Inditex invests in tech to speed future sales
▼ + stars: | 2023-03-15 | by ( Corina Pons | ) www.reuters.com time to read: +3 min

Inditex has extended its lead over Swedish rival H&M (HMb.ST), in part because of a less price-sensitive customer base. As the cost of making garments increased, H&M took a profit hit while Inditex was able to pass on costs to shoppers. In-store and online sales rose 18% to 32.6 billion euros ($34.99 billion) from 2021 and were 15% higher than in 2019, before the pandemic hit. Excluding Russia, where Inditex stores have been closed since the Ukraine conflict started just over a year ago, sales in that period were up 17.5% in constant currency terms. Inditex also delivered a surprise, but by hiking capital expenditure to 1.6 billion euros from 1.1 billion euros previously.

☆ Zara Extends Lead Over H&M, Faces Down Threat From Shein
▼ + stars: | 2023-03-15 | by ( Trefor Moss | ) www.wsj.com time to read: 1 min

Zara’s business model enables new designs to reach its stores relatively quickly. For years, Zara owner Inditex SA vied with H&M Hennes & Mauritz AB for global fast-fashion supremacy. Now, the Spanish retailer is pulling ahead of its rival, partly as its pricier offering has set it farther apart from new low-price, online competitors such as Shein. The perception among shoppers that Zara is more upmarket than H&M has also given the brand more leeway to increase prices at a time of cost inflation, analysts say.

☆ Zara Tightens Grip on Fast-Fashion Crown, Pulling Further Ahead of H&M
▼ + stars: | 2023-03-15 | by ( Trefor Moss | ) www.wsj.com time to read: 1 min

☆ Zara owner Inditex sees 2023 sales keep pace, but capex plans disappoint
▼ + stars: | 2023-03-15 | by ( Corina Pons | ) www.reuters.com time to read: +2 min

In-store and online sales for the world's biggest fashion retailer rose 18% to 32.6 billion euros ($34.99 billion) from 2021 and were 15% higher than in 2019, before the pandemic hit. The pace of sales continued in the first six weeks of Inditex's current fiscal year to Jan. 31, 2024. Between Feb. 1 and March 13, Inditex said sales jumped by 13.5% from the same period a year earlier. Excluding Russia, where Inditex stores have been closed since the Ukraine conflict started just over a year ago, sales in that period increased by 17.5% in constant currency terms. But Inditex surprised investors with a hike in capital expenditure to 1.6 billion euros from 1.1 billion euros in the previous year, a higher level than expected by the market.

☆ Zara owner Inditex's profit jumps in Marta Ortega's first year in charge
▼ + stars: | 2023-03-15 | by ( Corina Pons | ) www.reuters.com time to read: +2 min

MADRID, March 15 (Reuters) - Zara owner Inditex (ITX.MC) on Wednesday posted a 27% increase in net profits in 2022 as sales exceeded pre-pandemic levels in the first full year since Marta Ortega, daughter of founder Amancio Ortega, took over as company chair. Between Feb. 1 and March 13, Inditex said its sales jumped by 13.5% from the same period a year earlier. The 2022 revenues were in line with analysts' expectations as the company benefited from shoppers' appetite for fashion as COVID-19 lockdowns ended. The results may also lessen investor doubts about Marta Ortega succeeding the veteran Pablo Isla as non-executive chair in April, in a generational handover that began a decade ago when her father retired. Also on Wednesday, rival H&M (HMb.ST) reported a 12% increase in net sales for its December-February period.

☆ Zara shoppers are crowding back to the brand's stores, and it's sending sales skyrocketing
▼ + stars: | 2023-03-15 | by ( Avery Hartmans | ) www.businessinsider.com time to read: +3 min

Zara shoppers flocked to stores in 2022, giving a major sales boost to parent company Inditex. Inditex reported a 23% increase in store sales last year despite closing 10% of its stores. Zara shoppers have long complained that stores are crowded and checkout lines are unusually long. "A key factor of the year has been that traffic and store sales increased markedly," García Maceiras said. The US is a key market for Inditex, García Maceiras said, and has potential to provide a "significant" boost to the retailer's business long-term.

☆ Zara is opening or revamping nearly 30 stores in the US by 2025 — here's where they're located
▼ + stars: | 2023-03-15 | by ( Avery Hartmans | ) www.businessinsider.com time to read: +3 min

Inditex is planning to open at least 10 new Zara stores across the US by 2025. At least a dozen other Zara locations will be revamped or enlarged, the retailer said. "This is a market in which for every $100 of fashion sold, we take less than $0.50 of that," García Maceiras said. Foot traffic is up at Zara stores around the world, and Inditex reported a 23% jump in store sales in 2022 across its portfolio of brands, which includes Zara, Bershka, and Massimo Dutti. Inditex plans to invest 1.6 billion euros, about $1.7 billion, in expanding its stores and warehouses worldwide, including a new Zara store on Paris' Champs Elysées, and at least 10 new locations across the US.

☆ Zara owner Inditex's profit jump in first year with Marta Ortega at helm
▼ + stars: | 2023-03-15 | by ( ) www.cnbc.com time to read: +1 min

Zara owner Inditex on Wednesday posted a 27% net profit increase in 2022 as sales exceeded pre-pandemic levels in the first full year since Marta Ortega, daughter of founder Amancio Ortega, took over at the helm of the company. In-store and online sales for the world's biggest fashion retailer reached 32.6 billion euros ($34.99 billion), 18% more than the 27.71 billion euros posted last year and 15% higher than in 2019, before the pandemic hit. The company net income soared to 4.1 billion euros ($4.40 billion). The fashion giant revenues were in line with what analysts expected as the company benefited from shoppers' appetite for fashion in the post-Covid period. Inditex's strong results will appease initial investor concerns about Marta Ortega succeeding the veteran Pablo Isla as non-executive chair in April, in a generational handover that began a decade ago when her father retired.

Shares in H&M were down 6% in early trade, underperforming the wider Swedish market (.OMXSPI). The Swedish group said sales measured in local currencies for the period, its fiscal first quarter, rose 3% from a year earlier. Jefferies said local-currency sales, the figures most watched by markets, were significantly lighter than consensus estimates and implied that sales in reality fell 3% in February. By contrast, market leader Inditex (ITX.MC) reported on Wednesday a 13.5% increase in Feb. 1 - March 13 sales and a 27% net profit increase for its fiscal year through January. Royal Bank of Canada (RBC) said it expected continued input cost increases in the first quarter for the retailer and that it would stay under pressure into the second quarter.

☆ European shares sink as banks resume selloff, Credit Suisse hits new low
▼ + stars: | 2023-03-15 | by ( Shreyashi Sanyal | ) www.reuters.com time to read: +3 min

The pan-European STOXX 600 index (.STOXX) fell 2.5% by 1118 GMT, languishing at 10-week lows, as was the banks sector index (.SX7P) after plunging nearly 6%. The bank index is set to lose more than 120 billion euros ($127.26 billion) in market value since the close of March 8. Shares of Credit Suisse (CSGN.S) fell below 2 Swiss francs ($2.18) after the lender's biggest shareholder said it could not raise its 10% stake, citing regulatory issues. There was also a cooling of optimism that the U.S. Federal Reserve will tone down its rate-hiking spree next week in the aftermath of Silicon Valley Bank's (SVB) collapse. Retailers (.SXRP) shed 5.0% after shares of Zara-owner Inditex (ITX.MC), the world's biggest fashion retailer, fell 5.2% as it flagged higher investment spending.

☆ H&M launches U.S. resale program
▼ + stars: | 2023-03-14 | by ( Katherine Masters | ) www.reuters.com time to read: +3 min

NEW YORK, March 14 (Reuters) - Fast-fashion retailer H&M (HMb.ST) launched a resale program Tuesday in collaboration with ThredUp, an online consignment platform that has partnered with dozens of brands to run their used clothing sales, H&M told Reuters. H&M will be the largest retailer to work with ThredUp, and the partnership will mark the retailer's first resale marketplace in the United States, according to Abigail Kammerzell, head of sustainability for H&M North America. Roughly 30,000 articles of clothing will initially be available on H&M’s resale site. Some critics say that efforts by H&M and other large retailers to enter the resale market are undercut by the volume of clothing they produce. H&M does not currently plan to slow its clothing launches or reduce the overall number of items it sells, according to Kammerzell.

☆ Spain's Mango plans U.S. expansion after China retreat
▼ + stars: | 2023-03-14 | by ( Corina Pons | ) www.reuters.com time to read: +2 min

BARCELONA, Spain, March 14 (Reuters) - Spanish fashion retailer Mango is focusing on U.S. expansion after turning its back on China, Chief Executive Officer Toni Ruiz said. It will target states where online sales are already strong. It maintains four franchise outlets and online sales through Alibaba's Tmall e-commerce platform. Mango reported record sales last year, helped by selling more items at higher prices. Its biggest rival, Inditex-owned label Zara (ITX.MC), is expected to report record sales on Wednesday, partly due to its aggressive U.S. expansion.

REUTERS/Miguel VidalA CORUNA, Spain/LONDON, Feb 28 (Reuters) - In Spain's A Coruna, two contrasting fashion business models collide - pitching the growing demands for the clothing industry to become more sustainable against the constant need to drive sales. This rainy, windswept, city on the rugged Atlantic coast is the unlikely headquarters of Zara-owner Inditex (ITX.MC) - the world's biggest fast fashion retailer. It also hosts small boutiques offering high quality, durable products that consider themselves an alternative to the fast and affordable fashion propelling Inditex's annual sales of 28 billion euros ($30 billion). "If you release tonnes and tonnes of clothes, textiles, shoes into the market, you will have to collect it," he said. But Circ and its competitors are only capable of producing 1% of the textiles needed to make the 109 million tonnes of clothes per year that the global fashion industry churns out.

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