The Spanish fashion giant behind Zara, Inditex, posted net income of €1.4 billion in the first quarter, up 5.4% year-on-year and ahead of market expectations.
Sales rose 5.8% to €8.7bn, or 8.8% at constant exchange rates, ahead of the roughly 8% analysts had anticipated.
Gross profit rose 6.9% to €5.4bn, helped by an improvement in profit margins, meaning the company kept a larger share of revenue as profit. EBITDA, a measure of underlying earnings, increased 7.3% to €2.6bn.
Inditex shares rose more than 5% on Wednesday after the company reported a strong start to the second quarter, with sales increasing 11.5% between 1 May and 1 June, reassuring investors that the Zara owner remains resilient despite signs of weakening consumer spending.
"Inditex continued its strong momentum with its latest results beating first quarter expectations, and also seen a strong start to the second quarter too, as sales grew more or less in line with the rate the company exited with in the previous quarter," said Mamta Valechha, consumer discretionary analyst at Quilter Cheviot.
