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In 2012, Inditex set new records all round (sales, gross margin, EBIT, EPS and net cash). While Q4 saw a slowdown in organic sales growth (due to a higher base effect) and disappointing gross margin performance (due to the rise in Spanish VAT not being passed on to customers), growth momentum showed no sign of flagging, with revenue up 12% at mid-Q1: promising! For 2013, there is no shortage of drivers of profitable growth (expansion in China and Russia and the ramp-up of online sales). PLUS rating reiterated!
The Q3 results are of good quality with an impressive growth in sales (+17.8%), a significant improvement in the gross margin (+45bps) and a sharp increase in the EPS (+22% to €1.14) even if they surprised the market less than in Q1 and Q2. It should be noted that growth is not slowing with sales in mid-Q4 which have grown by +15% - promising! For 2013, the drivers of profitable growth are there (expansion in China and Russia and an increasing ramping-up of online sales) with a cotton price which remains very favourable for margins. PLUS rating reiterated!
Inditex is still managing to surprise the market! The group’s Q2 results have proved stronger than expected across every line in the P&L statement. Sales growth (+17.7%) and a considerable improvement in the gross margin (+100 bps) have pushed net earnings up 32%. Better still, the strong growth momentum shows no sign of flagging, and, according to the group, is even set to accelerate in Q3. For the next few quarters, there is no shortage of drivers of profitable growth (expansion in China and Russia and the ramp-up of online sales), while falling cotton prices will significantly boost margins. PLUS rating reiterated!
Inditex manages to keep on surprising us! The group’s Q1 results have proved stronger than expected across every line in the income statement. Sales growth (+15.4%) and a considerable improvement in the gross margin (+140 bps) have pushed net earnings up 30% to €432m. The year has got off to a very solid start, which management confirms has continued into Q2. With margins boosted significantly by falling cotton prices, we are confident: there is no shortage of drivers of profitable growth (expansion in China and Russia and the ramp-up of online sales). PLUS rating reiterated!
Inditex has surprised us yet again! Organic sales growth was better than expected (+4%); the gross margin was also strong at 59.3%, despite a difficult environment. This performance gained further momentum in Q4. This is all the more promising as Q1 2012 has got off to a very good start and the margin will benefit greatly this year from the falling cotton price! We are therefore confident because profitable growth relays certainly exist (expansion in Asia, rising online sales) and the company’s financial situation is strong (€3.5 billion cash). Plus code confirmed!
Inditex has surprised us yet again! The results for the first 9 months/Q3 2011 are reassuring and better than expected on the operational side. As anticipated, sales growth eased in the third quarter (unseasonably good autumn weather in Europe), but the first 6 weeks of Q4 have seen a recovery! The gross margin held up better than expected (-28 bps at 59.6% against a consensus at 59.1%) accompanied by a fine improvement (+100 bps) in Q3 which has led the management to raise its annual guidance! The quality of the business model is undeniable, especially as it is teamed with profitable growth relays for the future (expansion into Asia, launch of online sales) and a comfortable financial situation (€3.1 billion cash). Plus code confirmed.
H1 was expected to be a delicate period in several respects. However, Q1 2011 results are reassuring. Organic sales growth proved robust, the gross margin held up better than expected and the operating result came as a pleasant surprise ( +7% to €431 million against consensus at €420 million). Business remains dynamic in Q2 and the outlook for the gross margin in H2 has improved. The quality of the business model is incontrovertible, especially as it is accompanied by strong growth relays (international development in Asia, launch of online sales) and a solid cash position (€3.4 billion). Plus code confirmed.
2010 was an excellent year and 2011 will turn out to be less fragile than expected. The quality of the business model is undeniable, especially as it is fulled by profitable growth relays for the future: +10% retail floor space, international expansion in the emerging countries and successful launch of online sales. Our Plus code is confirmed by the visibility of profit growth prospects (+10% over 3 years).
Q3 2010 results are good and better than expected at every level. More demanding comparison bases suggest that sales growth (Q4 2010) and the gross margin (H1 2011) will slacken. The market has taken fright, but that is a short-term view! The quality of the business model is beyond doubt, especially as it is accompanied by profitable growth relays for the future (internationalization in Asia, launch of online selling) and a comfortable financial situation (€3 billion in cash). Inditex continues to promise good profit growth (EPS +18% in 2010/12). PLUS code confirmed.
Inditex has stood up well in face of the weak Spanish and European economies. In fact, 2010 will turn out to be an excellent year. The quality of the business model is undeniable, together with profitable growth relays for the future: international expansion in emerging countries and launch of online sales. Our PLUS code is confirmed by the visibility of even better profit growth prospects (EPS CAGR of +19% during 2010/12).
Les résultats du S1 sont supérieurs aux attentes à tous niveaux. La croissance de l’activité accélère, la marge brute s’améliore de +410pb, l’EBIT bondit de 69% à 829mio€et la trésorerie nette atteint 2.5mia€. La qualité du business model en place ne se discute pas d’autant qu’elle s’accompagne de forts relais de croissance profitable pour l’avenir: une internationalisation accrue sur les émergents et le lancement de ventes on line. Non seulement 2010 sera un excellent millésime mais Inditex offre une bonne visibilité sur des perspectives de croissance des résultats encore plus forte (BPA +19% sur 2010/12). Code Plus réitéré sur le titre.
Inditex held up well in face of the weak Spanish and European economies in 2009. The Group is about to come back to pre-crisis growth rate s . International expansion (dynamic emerging countries), an efficient cost-cutting plan (€75 million), “value for money” positioning and a less negative situation in Spain are all factors which hold out the promise of strong growth in 2010/11.
2009 results were better than expected at every level; this should be enough to convince the last remaining sceptics that the business model is good. 2010 has got off to a strong start: sales +14% (+6-7% in organic terms) and stabilization in Spain (32% of sales). The strong presence on emerging markets plays a driving role and is a growth reservoir for the future. Over and above the gross margin which is set to benefit from this greater internationalization and the favourable trend of the dollar parity, cost cutting is set to continue. Prospects for the coming year are looking good!
The deterioration of the loan market in Spain and negative macroeconomic figures are hitting the Spanish stock market hard. Inditex has suffered an 8% fall in the past two days. While its exposure to Spain (30% of sales in 2009) may generate uncertainties, we believe that 1/The Spanish situation must be put in perspective and 2/ The dominant role of the emerging markets mitigates the influence of the Spanish situation. We regard the fall in value of Inditex as an opportunity to take up a new position on this share. PLUS code confirmed.
Salient features of the Q3 results are a better than expected operating result and net profit even if organic sales growth was slightly below target (weather too mild for the winter collection). In the first 6 weeks of Q4 sales were up 9% at constant exchange rates, i.e. implicit organic growth between +1.5% and +3%: a distinct improvement on Q3. In view of the dynamism of emerging countries, benefits of the cost-cutting program (€75 million) and “value for money” positioning, Inditex offers promising growth prospects for the next two years. PLUS code confirmed.
Inditex held up well in face of the slowing European and Spanish economies in 2009. Thanks to greater internationalisation (dynamism of emerging countries), a new cost-cutting plan (€75 million), its “value for money” positioning and a potential economic upturn in Spain, growth prospects for the next 2 years look promising. We reiterate our code PLUS on the share.
Results for first half 2009 (close, end July) are above expectations on all measurements (sales LFL basis, EBITDA, net income). The second quarter was characterised by resistance better than forecast for organic growth (-1% vs -2/-3%) despite a difficult Spanish market (-8%). The first 6 weeks of the third quarter are seeing sales with steady increases of 9%, which adjusted for the effect of opening new stores yields stable LFL growth: recovery is underway and the outlook for second half 2009 is attractive. We repeat our Plus rating.
Q1 results are characterised by a better than anticipated performance in terms of organic growth (-1/2% versus -3/4%). In addition, the trend for the first 5 weeks of Q2 shows sales up by +9% at constant exchange rates which, coupled with the effect of store openings, puts organic growth at -1/0%: a remarkable performance in the current context. The strength of the Inditex business model is therefore confirmed once again and hints at good prospects, even though 2009 will be a difficult year. Plus code reiterated.
Performance reported in 2008 proves that the group is strong enough to resist the sharp slowdown of the Spanish and European economy. Without dismissing this risk, which is still present today, we believe that Inditex is much better protected than its competitors thanks to “value for money” positioning, greater internationalisation, the impact of its productivity plan (Reduce 3) and new cost-cutting measures (€75 million) which enable it to envisage a further progression of its cash flow and net treasury in 2009.
2008 results are strong, removing fears of a lower operating and net profit. Good news: like for like sales are stable (consensus -1/-2%) and the gross margin has held up well (+14 bp at 56.8%) exceeding the original objective of stability. The start of the year is reassuring and priority in 2009 will be given to cost and cash management. The management hopes to achieve €75 million worth of savings (new plan) and is committed to higher FCF and net cash resources. Plus code confirmed.
Q3 results are solid. Despite the economic slowdown, sales growth in Q3 did not slacken against H1 (+11% published, +1% LFL ), while the gross margin has improved (+46bp) over 9 months. The announcement of a similar sales growth trend for the first 6 weeks of Q4 comes as a very pleasant surprise. That performance highlights the lower dependence of Inditex on the domestic market, the success of increased internationalisation and the impact of the Reduce 3 cost-cutting plan. PLUS code confirmed.
The solid performance reported in 2008 proves Inditex’s resilience to the sharp slowdown of the Spanish economy. Without dismissing this risk, which is affecting the whole of Europe today, we believe that Inditex is much better protected than its competitors thanks to “value for money” positioning, greater internationalisation and the benefits of its productivity plan (Reduce 3).
First half-year results are solid. Despite the economic slowdown in Spain, the group’s organic growth remained positive (+1%) and its gross margin improved (+75bp). A performance such as this underlines the lesser dependence of Inditex on the domestic market, the success of increased internationalisation and the positive effect of the Reduce 3 savings plan. The good start registered by the autumn collection (sales growth in the middle of the third quarter close to that of the first half-year) is reassuring, but does not remove the risk inherent in the European economic slowdown. PLUS code reiterated.
The performance reported in 2007 proves that the group is strong enough to resist the Spanish economic slowdown. Without dismissing this risk which is affecting the rest of Europe in 2008, growth prospects underpinned by greater internationalisation, the impacts of the productivity plan (Reduce 3) and the attractive valuation, explain our confidence in this share.
Inditex has published its results for 2007. These confirm the slower growth of business activity with a constant scope of consolidation (+5%; +15% reported) but are better than expected for the operating profit and net profit. This performance shows that the group is proving resilient in face of Spanish economic slowdown. The effects of the productivity plan (Reduce 3) and the management’s reassuring message (sales up 17% at the beginning of 2008 at constant exchange rates) underpin our confidence in this share. PLUS code confirmed.
This morning, Inditex published its results for the 1st half of 2007 (6 months ending 31 July); they were better than expected. The numbers are all satisfactory: for sales growth (+19%, +7% against the comparable period last year), gross margin improvement (+80bp) and net profit (+33% to 393 million €). This reassuring performance, visibility of top line growth (7 weeks of the 2nd half in line/no slowdown in Spain) and the impact of the productivity gains plan (Reduce 3) all underpin our optimistic view for 2007/2008. PLUS code confirmed.
The 2006 results are better than the market had expected; the strong operating result (+24% at €1.36 billion) which has grown faster than sales (+21.6%) came as a pleasant surprise. This performance and the stability of the gross margin at 56.2% strengthen the management’s credibility over improved cost control. Beyond the good visibility of business growth, the effects of the productivity improvement plan (Reduce 3) and a more favourable base (currencies/costs) makes us even more optimistic for 2007. PLUS code maintained.
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