Results round-up

Software product group Micro Focus International announced its unaudited interim results for the six months to 31 October on Wednesday, with revenues of $684.7m, 14.2% higher than the prior year's constant currency figures.

The FTSE 100 firm said underlying adjusted EBITDA was $320.3m, 20.9% higher at constant currencies, and adjusted diluted earnings per share increased by 20.5% to 89.20 cents.

Pro-forma constant currency revenues increased 1.2% to $684.7m in the period, slightly ahead of the guidance range for the full year.

The board confirmed that the acquisition of Serena Group completed on 2 May, and so trading results of Serena were included in the interim figures.

It also noted that in September it announced it had agreed with Hewlett Packard Enterprises to merge with the software business assets of by way of merger.

The transaction is expected to complete in the third quarter of the calendar year 2017, though exceptional pre-acquisition costs were incurred in the period and further exceptional costs will be incurred for the remainder of the FY17 and to completion in FY18.

Cash generated from operations was $201.9m, up from $162.7m, and represented 69.3% of adjusted EBITDA less exceptional costs.

Net debt at 31 October was $1,612.6m, wider than the $1,078.0m figure at the end of April but down from $1,625.0m following the completion of the Serena acquisition on 2 May.

Free cash flow during the period was $111.0m, up from $40.3m, and net debt to facility EBITDA for the 12 month period to 31 October was a multiple of 2.6 times, decreasing to 2.4 times on a pro-forma basis including the acquisition of Serena.

The board’s medium term target remained 2.5 times.

Spanish retailer Inditex, the holding company of fashion chains Zara and Bershka, reported a rise in sales for the year to date as it opened new stores.

The world's biggest clothing retailer by market value with over 7,000 shops globally, reported an 11% surge in sales to €16.4bn, for the year ended 31 October compared to last year, while earnings jumped 9% to €2.2bn, which was more or less in line with expectations.

On a constant currency basis sales gained 15%, while the gross margin slipped to 57.9% from 58.8% year-on-year.

For the third quarter, sales rose 11% to €5.93bn, compared with compared with expectations of €5.91bn.

The retailer had outperformed its peers such as H&M and Abercrombie & Fitch who reported disappointing fourth quarter results last month.

Analysts at Bryan, Garnier & Co said that this performance implied like-for-like growth of about 6% compared to the 11% in the first half the year.

The broker also said that the company was “best equipped to thrive” in the retail environment due to its strategy of collections based on customers’ purchases, and the ability to launch a new collection with two weeks, versus the six months for the industry.

About 60% of the fast-fashion retailer's clothes are made in Spain, Portugal and Morocco, making shipping quicker to its mainly European markets.

Chairman Pablo Isla said the company had opened 20 stores during the year and that retail space should grow between 6% and 8% over the next few years. In the third quarter the company entered new markets in New Zealand and Vietnam.