Clothing giant sees slow Q4 growth
Inditex SA's fourth-quarter profit increased 16 percent, the slowest rate in four years, and Europe's largest clothing retailer said sales probably won't reach the high end of its forecast in coming years.
Net income in the three months ended Jan 31 rose to 425 million euros, the Arteixo, Spain-based company said yesterday. That compares with the 404 million-euro average estimate of 14 analysts polled by Bloomberg. Inditex expects same-store sales to climb 4 percent a year over the coming years, compared with a previous forecast of 4 percent to 5 percent, said spokesman Raul Estradera.
The turmoil in credit markets stemming from defaults on US subprime mortgages has pushed up the cost of mortgage payments across Europe, cutting into consumers' purchasing power. Same-store sales rose 3 percent in Inditex's second-half, down from a rate of 7 percent in the first half, the retailer said yesterday.
Revenue has gained 17 percent in the current quarter excluding currency movements, according to Inditex, which gets 38 percent of sales from its domestic market.
The retailer said it will spend 1 billion euros to expand this year, adding as many as 640 new stores. About 85 percent of the outlets will be outside Spain.
Agencies
(China Daily 04/01/2008 page17)
