By Mauro Orru
Industria de Diseno Textil SA, the owner of Zara known as Inditex, said Wednesday that it swung to a net loss for the first half of its year while sales plunged as it reeled from the impact of temporary store closures due to coronavirus lockdown measures.
The Spanish fashion giant, which also owns Oysho, Massimo Dutti and Pull&Bear, reported a net loss of 195 million euros ($231 million) for the six months ended July 31 compared with a net profit of EUR1.55 billion a year earlier.
The result includes a EUR308 million provision for its store-optimization program. The company previously said it would close between 13% and 16% of its total store network as part of a 2020-22 strategy.
Inditex posted a first-half loss before interest and taxes of EUR198 million compared with earnings of EUR2.04 billion, while earnings before interest, taxes, depreciation, and amortization dropped to EUR1.49 billion from EUR3.45 billion.
Net sales slipped to EUR8.03 billion from EUR12.82 billion, although online sales grew 74%.
The company said it is seeing a rapid recovery in operations heading into the second half.
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