Inditex, the world's biggest clothing retailer and owner of the Zara brand, stretched its lead over rivals like H&M with an 18 percent rise in first-quarter profit. But, as Kate King reports, sales growth has slowed in recent weeks.
The world's biggest clothing retailer displaying its might. Spanish firm Inditex, owner of Zara, stretching ahead of its rivals reporting a first quarter profit of 733 million dollars That's an 18 percent rise. (SOUNDBITE) (English) RABOBANK, SENIOR CURRENCY STRATEGIST, JANE FOLEY, SAYING: "A very substantial proportion of the businesses within Inditex do report in local currencies meaning that the currency outlook can have a supportive impact, and well potentially it could have a more detrimental impact. And what the business is saying now is that they're looking for a little bit more stability in currencies and that should be supportive." Inditex opened 30 stores in the quarter, meaning it now has 7,385 outlets across the globe Close to half of them report their earnings in currencies other than the euro. Online growth is said to be helping the retailer But sales have slowed in recent weeks (SOUNDBITE) (English) RABOBANK, SENIOR CURRENCY STRATEGIST, JANE FOLEY, SAYING: "Many analysts are suggesting that younger people in general are more concerned with spending their money on activities rather than clothing and that has a negative potential for all the businesses in this space. So the results today are good although there is still some disappointment that that the margin wasn't as strong as expected." Despite rallying almost 13 percent in recent months shares in the retailer slipped 1.4 percent on news of the slow growth Inditex hoping that the trend doesn't mean it's going out of fashion.