Inditex Slips To Loss In Q1

Spanish fashion retailer Industria de Diseño Textil SA (IDEXF.PK) or Inditex reported Wednesday that its first-quarter net loss was 409 million euros compared to net profit of 734 million euros last year. EBIT was negative 508 million euros in the latest-quarter.

The company has decided to make a provision of 308 million euros related to the execution of the Plan to boost online and further integrate the store platform.

Quarterly sales dropped 44 percent to 3.3 billion euros from last year, despite as many as 88% of the Group's stores being closed at some point during the period due to the Covid-19 pandemic.

Inditex expects online sales to account for over 25% of the total by 2022, compared with 14% in fiscal year 2019. It will have larger, higher quality stores, higher leves of profitability, and helping generate 4-6% like-for-like growth annually.

Inditex plans to reinforce all of its brands' e-commerce capabilities.

Inditex plans to continue with the store upgrade plan underway since 2012 under which it has opened a gross 3,671 stores that are larger, in more high-profile locations and already integrated with online.

Inditex plans to have a total network of between 6,700 and 6,900 stores, from 7,412 today, which will involve opening 450 new stores fitted with all the latest sales integration technology and absorbing between 1,000 and 1,200 smaller-sized stores.

The company said its board will propose the company's shareholders to approve the payment of an ordinary dividend of €0.35 per share, payable on 2 November 2020.

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