Retailers upbeat as economy recovers: Zara owner Inditex, B&M and WH Smith report rising sales

Three major retailers struck an upbeat tone yesterday as the economic recovery continues.

Zara-owner Inditex, discounter B&M and WH Smith said that they were optimistic about the months ahead as they posted rising sales.

It comes amid hopes of interest rate cuts this summer, which would bring relief to homeowners and businesses alike.

‘These retailers are proof that the economy doesn’t need to be soaring ahead to come out on top,’ said AJ Bell analyst Dan Coatsworth.

‘B&M, WH Smith and Inditex are good representations as they target different parts of the market. Their achievements show the industry isn’t simply doing well in one or a handful of areas, success is more broad-based.’

The updates came as the British Chambers of Commerce raised its forecasts for economic growth in a boost for Rishi Sunak.

The business lobby group said Britain is on course for growth of 0.4 per cent in the second quarter of the year following expansion of 0.6 per cent in the first quarter.

And it raised its forecast for the whole of 2024 from 0.5 per cent to 0.8 per cent as the UK recovers from the mild recession of late 2023.

Vicky Pryce, chairman of its economic advisory council, said: ‘There is life in the UK economy but if it is to gain momentum then it must be nurtured.’

B&M boss Alex Russo said his business was ‘well set for the years ahead’ as it looks to expand from 714 stores to 1,200.

Sales hit a record £5.5billion in the year to March 30, up 10.1 per cent on the year before.

WH Smith predicted its airport and railway station shops would do well this summer thanks to holiday makers. 

Although sales fell at High Street shops over the three months to June 1, this was offset by upbeat trading at its transport hubs. Sales were up 8 per cent in total.

It said that it was seeing ‘strong results’ from its transformation into a ‘one-stop-shop for travel essentials’.

Zara owner Inditex echoed the positivity as it batted away competition from budget rival Shein and posted higher sales.

The world’s largest fashion retailer said sales were up 12 per cent for the period between May 1 and June 3 compared to the same period last year.

The company, which also owns Pull&Bear and Massimo Dutti, plans to expand its shopping-channel style streaming shows to the UK. Webcasts which display models showcasing its new clothes have done well in China.

Shares in Madrid-listed Inditex and London’s WH Smith rose 3.7 per cent and 0.4 per cent respectively. But B&M fell 7.3 per cent.