Industria de Diseño Textil, S.A.

Buenos dias a todos. Good morning to everybody. We'd like to thank you all for attending Inditex's full year 2024 results presentation. My name is James O'Shaughnessy, Investor Relations. This presentation will be hosted by our CEO, Oscar Garcia-Macedas, as well as our CFO, Ignacio Fernandez. I'd like to welcome our new Director of Investor Relations, Gorka Garcia-Tapia, who many of you will get to meet over the next few weeks. As per usual, this presentation will be followed by a question and answer session, which will commence with telephone questions and will then be followed by any questions from the webcast platform. Let's take this disclaimer on your screens right now as read. And now over to you, Oscar.

Good morning and welcome to our full year 2024 results presentation. I am happy to see so many people joining us today. In 2024, Inditex saw a very solid performance. This performance was driven very much by the creativity of our teams and the strong execution of our fully integrated business model. The sales growth of 7.5% has been excellent, and it's a clear demonstration that the demand for our collections has been consistently strong across the whole year. this sales performance has allowed us to reach new highs in terms of EBITDA and net income. It's of course the consistently and strong execution of the unique business model that you have all come to know that has driven the gross margin performance and has led us to also control costs so well. At the bottom line, net income increased 9% to 5.9 billion euros. The sound operating performance over the period has served to further reinforce the solid financial position we find ourselves in, as illustrated by the significant levels of free cash flow generated. As a result of this, I am happy to say that we intend to propose a dividend increase of 9% for financial year 2024 to 1.68 euros per share. Spring summer collections have been well received by our customers. Store and online sales in custom currency between the 1st of February and the 10th of March, adjusting for the extra trading day in February due to the leap year, grew 4% over the same period in the previous year. In the last commercial week, store and online sales in custom currency increased 7%. We can all agree that it's our fully integrated store and online model that has been the main driver of the strong performance we have seen recently. This performance relies on the four key pillars that we have highlighted to you in past occasions. Our product offering, a unique customer experience, our focus on sustainability, and the talent and commitment of our people. These are the principal factors driving our ability to differentiate ourselves so consistently. We have operations across 214 markets and we enjoy a low market share within what continues to be a highly fragmented sector. This is what underpins the excellent growth opportunities we have before us. We have a strong commitment to profitable growth. Since the end of fiscal year 2022, Inditex has experienced a significant increase in sales and productivity. Sales have grown 19% on a reported basis in the period, with 4% less stores. We maintain the previous guidance for gross space growth that we mentioned last year of 5% for the period 2024 to 2026. The logistic expansion plan 2024 to 2025 we have already set out is on track. We continue to focus the ordinary capital expenditure on our global store base, the online platform and the rollout of technology programs aimed at enhancing the level of integration. Ordinary capital expenditure in 2025 is estimated in 1.8 billion euros. I'm going to take the opportunity to pass you to Ignacio in order to cover some of the financials.

Thank you, Oscar. As you can see from the release earlier this morning, the test has performed very well over 2024. Oscar has commented that sales and income have reached record highs. The sales performance has been strong at plus 7.5%. The supply chain has been actively managed, which in turn produced a very healthy gross margin. Operating expenses have of course been well managed and this has resulted in a satisfactory level of operating leverage. Consequently EBITDA grew 8.9% to 10.7 billion euros. This has flowed through to the bottom line with net income increasing 9% to 5.9 billion euros. The group continues to generate significant free cash flow And this has taken our net cap position to 11.5 billion euros. Let me reiterate that sales have progressed very well at plus 7.5%, reaching 38.6 billion euros. That translates into plus 10.5% in cost and currency. This strong growth was very broad-based and was driven by both store sales and online sales and all the concepts. Looking forward now, a current exchange rate, we expect a minus 1% top line FX impact in 2025. As already mentioned, sales were positive in all concepts. We do, of course, enjoy a global presence, and it is our aim to continue building up on this. In 2024, gross profit increased 7.6% to 22.3 billion euros, with a gross margin of 57.8%. The achieved gross margin illustrates well the level at which the business model has performed over the period. For this upcoming year, 2025, a stable gross margin of plus or minus 50 basic points will be a reasonable expectation. Respecting the operating performance of the group over the periods as a whole, operating expenses have been well controlled across all business areas. Operating expenses have grown below the rate of sales growth over 2024. If you include all these charges in the calculation, operating expenses grew 126 basis points below sales growth, demonstrating good operating leverage. From what we have been talking about already, you will see that we are quite happy with the operating performance of the business over 2024. The inventory position for the group as at the end of the period was up 12% compared to the closing position the year before. Current inventory balance was up 6% versus the same date in 2024. It's important to point out that this closing inventory is of high quality. The strong cash flow generation in the year has resulted in a growth of the net cash position of 1% to 11.5 billion euros. As you can see, funds from operations after fixed-list cash payments reached an all-time high of 7.7 billion euros. Now, before I pass you over, let me take this opportunity again to say welcome to Gorka Garcia Tapia. Gorka, please.