Fabric Products,Fabric Information,Fabric Factories,Fabric Suppliers Fabric News All Zara stores in Spain are closed, all goods are shipped to China, and the return cargo plane is loaded with medical supplies

All Zara stores in Spain are closed, all goods are shipped to China, and the return cargo plane is loaded with medical supplies



Last month, Zara’s parent company, Spanish fast fashion giant Inditex, mentioned when it released its 2019 financial report that due to the Spanish government’s tightened control, Inditex had closed all stores …

Last month, Zara’s parent company, Spanish fast fashion giant Inditex, mentioned when it released its 2019 financial report that due to the Spanish government’s tightened control, Inditex had closed all stores of its brands in Spain. It is planned to convert some fabric production lines into professional medical fabric production lines.

As the epidemic in Spain further intensifies, the Spanish government recently introduced stricter control regulations : From March 30 to April 9, non-essential workers in Spain must stay at home in isolation. This regulation means that the production lines of Inditex’s 13 clothing processing plants in Spain will stop producing fashionable clothes and switch to the production of medical supplies according to government needs, such as medical work clothes, masks, etc.

Although it is unclear what proportion of Inditex’s clothing is produced in Spain, Inditex has disclosed that in order to achieve rapid replenishment of stores around the world, Inditex has “57% of its clothing purchased from Spain” , Portugal, Turkey and Morocco’s garment factories.”

In addition to clothing manufacturing, Inditex’s 10 logistics distribution centers in Spain have almost stopped working. Normally, Inditex’s Spanish logistics center distributes goods to stores twice a week to ensure that stores have new products in a timely manner. Since Inditex’s Spanish stores have been closed, all store delivery work has been suspended.

Fortunately, the Spanish government believes that e-commerce business is still “indispensable” in the current environment. Inditex’s Spanish logistics center has not completely shut down and can still accept online orders. It’s just that the working hours are greatly shortened. According to a union representative, these logistics centers currently have one shift per week, with each shift lasting four hours. Workers are prioritizing unloading trucks from Turkish and Moroccan clothing suppliers to avoid strandings. Today, the number of trucks heading to Inditex’s Spanish logistics center has been greatly reduced.

According to a trade union, Inditex’s logistics and distribution platform in Zaragoza, Spain, requires workers to “work two shifts a week, each shift lasting four hours.” A worker who asked not to be named said that the current workload level of the Zaragoza logistics platform is only 15% of the usual level because the stores are closed, causing the warehouse to be filled with goods.

On the other hand, since the epidemic has been brought under control in China, Inditex is shipping these goods to China via cargo planes to meet online and offline orders in the Chinese market. Workers at the Zaragoza logistics platform said that when Inditex cargo planes fly back to Spain from China, they often return “fully loaded” with urgently needed medical supplies. Spanish government officials have highly praised Inditex’s move.

Last week, Inditex founder and billionaire Amancio Ortega said that his personal foundation had purchased medical supplies worth 63 million euros, or approximately 480 million yuan. Including ventilators, masks and test kits to help Spain fight the epidemic.

Extended reading:

Zara’s parent company released its latest annual report and plans to convert some factories to produce masks and Protective clothing fabrics to help Spain fight the epidemic

On March 18, Zara’s parent company and Spanish fast fashion giant Inditex SA (hereinafter referred to as “Inditex”) announced Key financial data for fiscal year 2019.

In fiscal year 2019, Inditex Group’s total sales increased by 8% year-on-year to 28.3 billion euros, once again setting a new historical record. The global outbreak of the new coronavirus epidemic has inevitably had an “extremely significant impact” on the group’s current business. Inditex allocated net profits to emergency reserves and did not announce dividend-related information.

Due to the spread of the epidemic, countries around the world have adopted emergency prevention and control measures, and public places that are not “necessary for people’s livelihood” in many countries have suspended operations. As a result, Inditex has closed 3,785 stores in 39 countries and regions around the world. On March 14, the Spanish government tightened control and Inditex closed all Spanish stores of its brands.

However, as the epidemic in China has gradually been brought under control, except for 11 stores, the group’s Chinese stores have resumed business. With the implementation of the first round of store closing policies, Inditex’s global sales fell by 24.1% in the first two weeks of March.

Inditex Group Chairman and CEO Pablo Isla is very satisfied with the group’s performance in fiscal 2019. He said that the group’s first priority is to ensure the health and safety of all staff and their families during this special period, and he is very grateful to teams from all over the country for their huge contributions. Inditex’s financial position is good and its profitability is constantly increasing. They are very confident in the group’s business model and long-term development. They will continue to implement long-term development plans and upgrade offline stores and online platforms. Due to the uncertainty of the epidemic, it is not yet possible to determine the impact of this incident on the group’s business.

Although the epidemic has had a heavy impact on retail channels, the group’s online business in all markets has remained normal. Thanks to the flexible business model, the group’s supply chain is also operating normally, and the spring and summer series have also been well received by consumers.

In order to help the Spanish government solve the shortage of medical supplies such as masks and medical protective clothing, Inditex plans to convert some fabric production lines into professional medical fabric production.�� line. Previously, the group donated 10,000 medical masks. This weekend, the newly allocated 300,000 special masks will also arrive.

In the 2019 fiscal year as of January 31, 2020, it owns Zara, Pull & Bear, Massimo Dutti, Bershka, Stradivarius, The core financial data of the Inditex Group, which owns brands such as Oysho and Uterque, are as follows:

Sales increased by 8% year-on-year to 28.3 billion euros, a year-on-year increase of 8% without calculating constant exchange rates

Gross profit increased by 7% year-on-year to 15.8 billion euros, and gross profit margin fell by 0.79 percentage points to 55.9%; in response to the outbreak of the new crown epidemic, Inditex set aside 287 million euros in inventory reserves. Excluding this reserve, the group’s gross profit increased by 9% year-on-year to 16.1 billion euros, and the gross profit margin increased by 0.22 percentage points to 56.9%

EBITDA (before interest, taxes, depreciation, and amortization Profit) was 7.6 billion euros, compared with 5.5 billion euros in the same period last year; excluding epidemic provisions, EBITDA increased by 44.5% year-on-year

Net profit increased by 6% year-on-year to 3.6 billion euros ; Excluding epidemic reserves, net profit increased by 12% year-on-year

Earnings per share: Due to the global outbreak of the new crown epidemic, the group’s net profit will be allocated to emergency reserves. In July this year, the group will release detailed information on dividends at the shareholders’ meeting.

Comparable store sales increased 6.5% year-on-year

FY 2019 , Inditex has carried out very active store optimization measures: 307 new stores have been opened, 328 stores have been closed, and 182 stores have been renovated (87 stores have expanded their area). As of January 31, 2020, Inditex operated a total of 7,469 stores worldwide (7,490 in the same period last year), and the retail space construction area in prime business districts increased by 2.5% year-on-year to 5.09 million square meters. </p

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