Inditex reports first-half sales growth of 7%, setting new records for revenues, profits and cash

  • Like-for-like sales growth reached 5% in the first half and was positive across all brands and geographies, in stores and online.
  • The Group posted record levels of net sales, profits and cash for a first half:
    • Net sales topped €12.82 billion for the first time, year-on-year growth of 7%.
    • Net profit hit a new milestone of €1.55 billion, up 10% year-on-year.
    • Net cash increased by 13% to €6.73 billion, the highest level ever.
  • Inditex’s Executive Chairman, Pablo Isla, highlighted the “strong first half performance reflected in these figures” and also underlined the “relevance of the investments we have made in the stores as well as in logistics and technology, all of which have been key elements in the development of our customer focused integrated store and online platform”.
  • Stores and online sales in local currencies increased 8% between 1st August and 8th September. Management estimates like-for-like sales growth of 4%-6% in FY2019.

Inditex Group net sales increased by 7% in the first half of 2019 (1 February - 31 July), topping €12.82 billion for the first time. In local currencies, sales growth was 7%. Momentum in like-for-like sales growth remained strong, at 5%, underpinned by growth across all brands and regions, stores and online.

The solid business performance drove first-half net profit to €1.55 billion, reflecting year-on-year growth of 10% (1H18: €1.41 billion). This figure includes the impact of the new lease accounting standard, IFRS 16, without which profit growth would have been 7%.

Similarly, EBITDA and EBIT, which registered year-onyear growth of 47% and 14%, respectively, would have increased by 8% and 7% in the absence of the new standard. The group maintained its strong cash generation: the net cash position increased by 13% to a record €6.73 billion.

Inditex’s Executive Chairman, Pablo Isla, underscored the “‘strong first half performance reflected in these figures, with like-for-like growth across all brands and geographies. The investments we have made in the stores as well as in logistics and technology have been key elements in the development of our customer focused integrated online and offline store platform”.

With respect to the start of the second half, store and online sales in local currencies increased 8% between 1 August and 8 September. Management estimates like-forlike sales growth of 4%-6% in FY2019.

Key figures (€ million)

  1H 2019 1H 2018 YoY chg.
Net sales 12,820 12,025 7%
Gross profit
Gross margin



EBITDA 3,447 2,343 47%
EBIT 2,040 1,784 14%
Net profit 1,549 1,409 10%


1. 1H19 Highlights

The cornerstone of Inditex’s growth strategy for its global platform is the addition of new sales space of the highest standard, alongside the continued development of the online business. Our newest stores feature cutting-edge technology in order to facilitate integration with Inditex’s ever-increasing e-commerce and also in line with the ecoefficient store programme, already in place in most of the brands’ stores.

Framed by this strategy, as the Group has continued to open, enlarge and refurbish its network of stores in all geographies, it has continued to expand its online platform ito new markets.

During the first half of 2019, introduced its online platform in Brazil, the United Arab Emirates, Lebanon, Egypt, Morocco, Indonesia, Serbia and Israel. After the close, in August, Zara inaugurated its online platform in Qatar, Kuwait, Jordan, Bahrain and Oman. It is also due to launch the platform in South Africa (18 September), the Ukraine, Colombia and the Philippines during the third quarter.

In all, at the July close, the Group had 7,420 stores in 96 markets; the integrated online platform was available in 62 of those. The online stores of Zara, Zara Home, Massimo Dutti, Pull&Bear, Stradivarius, Oysho and Uterqüe are also available in an additional 106 markets without physical stores, with Bershka scheduled to follow suit this September.

The deployment of the RFID technology remains essential to providing customers with a unique and seamlessly integrated online-offline experience.

This technology is already fully operational at Zara, Massimo Dutti and Uterqüe and the Group remains on track for full deployment across the other chains by 2020. 2020 will therefore mark the completion of the integration of the stocks of each store, market by market, with the online stockrooms (currently 33) around the world.

This digitally-driven investment plan is being complemented by the constant upgrading and modernisation of the Group’s logistics facilities. The construction work on the new digital production building to provide photography for in Arteixo (La Coruña, Spain) continues to make good progress and work has also begun on expanding the Group’s technological and data processing capacity in A Laracha (La Coruña, Spain).

Meanwhile, the construction and commissioning work at the logistics connection hub in Lelystad (Netherlands) remains on track. The new platform has successfully completed the tests performed in recent months and will be partially commissioned during the second half, ahead of schedule; it will be fully operational in 2020.

2. Brand activity

All the Group’s formats completed high-profile openings across a total of 31 different markets during the first half, complementing the refurbishment and expansion of over 100 existing stores to continue to create shopping destinations of the highest quality.

In parallel, the brands remained very active in reaching out to their customers, notably via new collections, style suggestions, innovative catwalk shows featuring the See Now Buy Now online purchasing option and partnerships with top creative talent from all around the world.

Zara opened stores in Hudson Yards (New York, US), Cannes (France), the Time World Mall (Dajeon, Korea), Rome (Italy), Warsaw (Poland) -where Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho and Zara Home also opened- and Timisoara (Romania), among other markets.

More recently, Zara has inaugurated a new store in Pamplona (Spain) in an emblematic building which the chain has brought back to life for the city. Tomorrow (12 September), Zara will open its expanded store in Dubai Mall, the largest single-storey Zara store in the world, with a floor space of over 5,000 square metres that will house the full women’s, men’s and kids collections.

Also tomorrow, the expanded Zara store on calle Preciados, one of the busiest shopping streets in Madrid, will reopen. The store has a floor space of over 4,000 square metres over six floors, in which Zara will unveil its latest image and newest customer experienceenhancing technology.

During the second quarter, Zara launched its third exclusive Zara SRPLS collection, inspired by military designs, reinvented and combined with different colour palettes and looks. Zara Edited continued to carve out a niche for itself, providing customers with the option of customising denim garments in selected stores and online in six markets.

Zara also launched a range of initiatives tied with the Group’s sustainability targets, including the TRFXJoin Life denim clothing collection, featuring by the latest in denim looks but made from recycled denim clothing.

This is Zara’s first post-consumer denim collection. In parallel, the Group’s stores continued to roll out their used clothing collection programme using containers placed in store; this initiative is enabling the brand to continue to recover clothing and turn it into new items so as to lengthen their life cycle.

Similarly, just last week, Zara launched a new Join Life capsule collection, Care for Water, made from organic cotton sourced from farms in the Indian region of Madhya Pradesh participating in the Organic Cotton Accelerator (OCA), of which Inditex is a founding partner. In collaboration with the NGO, Inditex is earmarking over $420,000 to help provide micro loans on advantageous terms to 4,000 organic cotton farmers in this region in order to facilitate their access to enhanced drinking water and sanitation facilities.

On 17 September, Zara is due to begin selling a wide selection of Zara Home items online in the UK, leveraging on the synergies created by its integrated platform. Zara Home launched its first line of kitchen utensils on its autumn/winter collection during the second quarter.

Massimo Dutti, meanwhile, commissioned photographer Mikael Jansson and art director Franck Durand to capture its looks and ideas for the new season, which, framed by the Group’s strategic commitment to innovation and technology, was on display at a new See Now Buy Now catwalk show held in Barcelona last Friday and broadcast live over the brand’s social media channels.

At Bershka, artist Nathy Peluso headlined the second On Stage concert at the Portal del Ángel store in Barcelona (Spain), an initiative that will bring leading names from the musical scene to the brand’s flagship stores around the world. To celebrate this performance, the artist collaborated with Bershka on a special capsule collection which merges the Latin fusion and hip-hop aesthetics. And with the third quarter underway, the chain worked with the teenage American singer and pop music phenomenon Billie Eilish on a special collection.

Pull&Bear, which opened its first store in Luxembourg and opened a high-profile store on Rue d’Antibes in Cannes (France), extended its collaboration with Rosalía, with a new line inspired by the singer’s personal look. Elsewhere, Pull&Bear Garden featured prominently at the Primavera Sound music festival, creating a venue for interacting with the brand in the form of a plastic recycling point, pop-up store, rest area and solar powerfuelled mobile charging station.

Stradivarius opened its store in Belgium, on one of the busiest shopping streets in the city of Ghent, in a building with an impressive light-filtering façade on Veldstraat. During the spring, the brand celebrated another of its Summer Expeditions, its fifth, choosing Mexico’s idyllic Pacific coast as the backdrop for its summer looks.

Having significantly expanded its store on Paseo del Born in Palma de Mallorca, and entered the Luxembourg market, Oysho held a new edition of Oysho Yoga in Madrid, for the first time using Join Life items for the materials given out to the participants. It also launched the Oysho Portraits lingerie collection, characterised by the use of a colour palette based on earthy tones.

Uterqüe, lastly, teamed up with Bobbi Brown, owned by Estée Lauder, to create a top-quality limited-edition range made in Ubrique, a luxury edition containing the cosmetic brand’s five best-selling products.

3. Sustainability

During the first half, the Group’s brands saw the sales of garments featuring the Join Life label, which aims to achieve the highest sustainability standards, increase considerably to 136 million items, which is as many as were sold during the previous 12 months, echoing the sustainability targets announced by the Group’s Executive Chairman, Pablo Isla, at the last Annual General Meeting. On this point, Mr. Isla said that the “Company’s strong business momentum and its decisive commitment to sustainability all along our value chain are clearly compatible”.

In 2019, 20% of Zara garments will feature the Join Life label. Across the Group, the Join Life label is expected to register growth of 110% for the year and by 2020 it will represent 25% of all the clothing sold by Inditex. Next year Inditex also will fully eliminate plastic bags at all its chains, a milestone already attained at Zara, Zara Home, Massimo Dutti and Uterqüe.

By 2019, all the Group’s distribution platforms and head offices will boast the most demanding green building certification and 100% of Zara stores will be eco-efficient, one year ahead of the original target. From this September, the at-home collection of used clothing for charitable donation or recycling, a service currently available in several cities in Spain and China, will be extended to Paris, London and New York.

By 2023, the Company will have fully eliminated customer-facing single-use plastics and 100% of the waste generated at the Group’s head offices, logistics platforms and stores will be sent for recycling or reuse. A key target announced at the Annual General Meeting held on 16 July was that by 2025, 100% of the cotton, linen and polyester used for the Group’s garments will be organic, more sustainable or recycled. Cotton, linen and polyester, together with viscose (for which this milestone will be attained in 2023), constitute 90% of the raw materials purchased by the Group.

Also by 2025, 80% of the energy consumed by the Group’s facilities (i.e., head offices, logistics platforms and stores) will come from renewable sources. Next year will mark completion of another of the more ambitious programmes being executed by Inditex, rendering a entire sustainable store network. Zara will complete this effort in 2019 and all the brands by 2020, enabled by the Company’s intense effort to fine-tune and digitalise its sales footprint.

Inditex’s Executive Chairman, Pablo Isla, had the opportunity to share the details of the Group’s ecoefficiency plan with the mayor of Beijing, Jining Chen, while visiting the first city in the world (along with the rest of China) where Inditex has completed this ambitious sustainability initiative, which has delivered energy savings of 46 million kWh since 2015.

In the second quarter, Inditex and Universidad Pontificia Comillas also renewed the Chair for Refugees and Forced Migrants, which, since 2016, has been investigating and researching the reality of the people who are forced to flee from their homes. The Chair will endow and award PhD fellowships to researchers for understanding the reality of the processes by which refugees arrive, are taken in and, especially, integrated into society, in Spain and rest of Europe.

4. Annual General Meeting

The Company held its Annual General Meeting on 16 July 2019, providing its shareholders with insight into the Group’s growth in 2019. In addition, its Executive Chairman, Pablo Isla, highlighted the sustainable growth posted over the years and the economic, social and environmental value created by the Group integrated and sustainable store and online business model.

As ratified at the Annual General Meeting, the Company will pay an ordinary final dividend and a special dividend totalling €0.44 per share on 4 November 2019, bringing the total dividend to €0.88 per share (the other €0.44 per share was paid out on 2 May 2019).