By Helen Reid LONDON, Dec 3 (Reuters) - Zara owner Inditex said sales grew 10.6% in constant currency over the start of its fourth quarter, beating analysts' expectations for the November period that
Inditex Exceeds Expectations with Strong Winter Sales Start
By Helen Reid
LONDON, Dec 3 (Reuters) - Zara owner Inditex beat analysts' expectations for the start of its fourth quarter on Wednesday, reporting currency-adjusted sales growth of 10.6% in November, a period that includes the crucial Black Friday weekend.
The results from Inditex, widely seen as a bellwether for global fast fashion, offer an early read of how retailers fared during the key discounting season, and signal a strong start to the company's biggest revenue quarter.
Shares jumped 7% in early trading to hit a nine-month high.
The Spanish fast-fashion group also reported robust third-quarter results to October 31, with currency-adjusted sales up 8.4% to hit 9.8 billion euros ($11.41 billion), higher than the 9.69 billion euros forecast by analysts.
SPANISH ECONOMY LIKELY BOOSTED REVENUE, ANALYST SAYS
Inditex did not provide a regional breakdown on Wednesday, but Spain's strong economy may be providing a boost to the retailer which makes around 20% of revenue in its home country, said Bernstein analyst William Woods.
"Spain has just been phenomenal; the Spanish economy is working and people are buying more clothes," he said.
Across Europe, consumer demand has been tepid as shoppers trade down from high-street fashion to cheap online platforms such as Shein and Temu.
However, Inditex has seemed more robust in the face of competition than rival H&M, which sells at lower prices overall.
STRONG QUARTERLY GROWTH DESPITE UNUSUALLY WARM OCTOBER
The Zara owner delivered strong third-quarter growth despite unusually warm October weather in parts of Europe that weighed on sales of higher-priced autumn and winter items, including jackets and coats.
Gross profit for the third quarter was up 6.2% to 6.1 billion euros, with gross margin hitting 62.2%, up from 58.3% in the first six months of the year.
After nearly three years of strong gains, Inditex shares have stalled this year as investors worry about slower sales growth.
In its drive to create a more premium shopping experience, Inditex - which also owns Bershka, Massimo Dutti, Oysho, Pull & Bear and Stradivarius - has been closing smaller stores and opening new, bigger flagships that drive higher revenues.
Inditex had 5,528 stores globally across its brands by October 31, down from 5,667 a year earlier.
($1 = 0.8587 euros)
(Reporting by Helen Reid, Editing by Muralikumar Anantharaman, Louise Heavens and Bernadette Baum)
