Inditex, the world's biggest clothing retailer, has reported a brisk start to the autumn season after first-half profit rose by a quarter. As Hayley Platt reports the owner of Zara was helped by the weather and a recovery in its Spanish home market.
An improving Spanish economy has helped boost net profit at Inditex. The fashion chain which owns Zara saw a rise of 26% to 1.17 billion euros. Sales in local currencies in the six weeks to September 10 also jumped 16 percent, as cheap oil and easier credit put more money in shoppers pockets IG's Alastair McCaig. (SOUNDBITE) (English) MARKET ANALYST, IG, ALASTAIR MCCAIG, SAYING: "The improving landscape as far as the economic picture for Spain is concerned has obviously helped them. We've also seen the sales targetted for the year ahead in China looking robust." Its results came just a day after rival H&M reported unexpectedly weak sales growth in August. It blamed hot weather - Inditex said that boosted theirs. (SOUNDBITE) (English) MARKET ANALYST, IG, ALASTAIR MCCAIG, SAYING: "You do feel the weather is utilised as a very useful tool to either boost your claims of success or utilise it as a reason for some of the disappointing sales figures. It's never particularly clear why the clothing retailer's utilise this." Inditex is in 88 markets and European sales make up two thirds of its total. Spain accounts for almost one fifth. Having its manufacturing base in Europe helps it respond more quickly than rivals to changes in both weather and fashion trends. It also shields it from the impact of a stronger U.S. dollar, the currency used by most Asian suppliers. Inditex expects currencies to give it a 0.5 percent boost to sales over its full year. Its shares, up almost a quarter this year, rose 3 percent after the results. But the group is keeping an eye on a slowing China.