Today’s news in brief-11/9/24

In July 2024, the UK economy saw no growth for the second consecutive month, failing to meet analysts’ expectations of a 0.2% expansion. The stagnant performance was largely due to mixed results across different sectors. The services sector recorded a slight 0.1% increase, primarily driven by a strong recovery in the information and communication subsector, which saw a 0.8% rise. This growth was particularly fueled by computer programming and consultancy services, which rebounded by 1.6% after a decline in June.

Inditex, the parent company of Zara, reported a strong financial performance in the first half of 2024, with sales rising by 7.2% year-on-year to €18.1bn. The company’s profit before tax grew by 10.6% to €3.6bn, reflecting the positive reception of its Spring/Summer collections. Inditex’s gross profits also saw a 7.5% increase, with a gross margin of 58.3%. The retailer’s success was attributed to strong sales across both physical stores and online platforms, with constant currency sales growing by 10.2%.

Boohoo announced a strategic shift by relocating its US fulfilment operations from a distribution centre in Pennsylvania to an automated facility in Sheffield, UK. This move follows a successful trial that expanded the range of products available to US customers by fulfilling orders from the UK, which led to encouraging sales results. The transition is expected to reduce ongoing costs significantly in the medium term, despite resulting in a write-down on Boohoo’s balance sheet and certain one-off exceptional costs.

Dunelm reported a 6.6% increase in profit before tax to £205m for the year ending June 2024, with total sales rising by 4.1% to £1.71bn. The company noted an increase in active customers across all demographics, with digital sales now accounting for 37% of total sales, up from 36% the previous year. Dunelm also expanded its physical presence by opening six new stores, in line with its strategic plans.