Zara’s owner set for worst year since 2008, as online competition bites
London — You know things are bad in Europe’s fashion industry when even Zara-owner Inditex is having a tough time. Shares in Inditex have fallen 4.5% in 2017, putting them on course for their worst year since 2008. While the drop is far less than for peers including Hennes & Mauritz (down 22%) and Esprit Holdings (down 35%), it illustrates that even the best in the business are not immune to the challenges of ever-increasing online and discount competition. "Even for them, they are seeing margins under some pressure, predominantly because the competitive landscape is so tough," said Mark Phelps, chief investment officer of global concentrated equities at AllianceBernstein in London. Third-quarter results due on December 13 are likely to prove the point. Like-for-like sales are set to show a "marked deceleration" in the second part of the period, according to Raymond James analysts, as mild European weather delayed purchases of autumn/winter garments. Yet they maintain that Inditex h...
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