INDITEX : CONFERENCE CALL TRANSCRIPT

INDITEX

INTERIM NINE MONTHS 2022

CONFERENCE CALL TRANSCRIPT

14 December 2022

Important notice: Although we try to accurately reflect the speech delivered, the actual speech that was delivered may deviate from this transcript.

INTERIM NINE MONTHS 2022

INDITEX PARTICIPANTS

Óscar García Maceiras - CEO Ignacio Fernández - CFO

Marcos López - Capital Markets Director

C o n f e r e n c e C a l l P a r t i c i p a n t s

Anne Critchlow Societe General - Analyst

Rebeca McClellan Santander - Analyst

Richard Chamberlain RBC - Analyst

Paul Rossington HSBC - Analyst

Georgina Johanan JP Morgan - Analyst

Warwick Okines Exane BNP Paribas - Analyst

Nick Coultier Barclays - Analyst

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INTERIM NINE MONTHS 2022

Introduction: Marcos López - Capital Markets Director

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Buenos días a todos, good morning to everybody. A warm welcome to all of those attending the presentation of Inditex's Results for the Interim Nine Months 2022. I am Marcos López, Capital Markets Director.

The presentation will be chaired by Inditex's CEO Oscar García Maceiras. Also with us is our CFO Ignacio Fernández.

The presentation will be followed by a Q&A session starting with the questions received on the telephone and then those received through the webcast platform. Before we start, we will take the disclaimer as read.

Please Oscar.

Slide 4: CEO

Slide 5: Inditex model delivers strong growth

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Slide 6: Inditex model delivers strong growth

Good morning and welcome to our results presentation. It is my pleasure to join you today.

In the first nine months of twenty twenty-two (2022) our business model has continued to deliver strong growth.

This performance relies on the four key pillars that we have introduced to you previously: Our product offering, a unique customer experience, our focus on sustainability, and the talent and commitment of our people.

We have had a very strong sales performance in the nine months of twenty twenty-two (2022), and this performance has continued beyond this period, with Autumn/Winter collections very well received by our customers.

The execution of the business model has also been remarkable despite a challenging environment.

These are the reasons why sales, EBITDA and net income have reached historic highs, both in the first nine months and in the third quarter of twenty twenty-two (2022).

Our operating performance places us in a robust financial position. We have generated significant free cash flow, taking our net cash position to ten (10) billion euros.

All this in conjunction with a well stablished dividend policy.

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INTERIM NINE MONTHS 2022

Slide 7: Inditex model delivers strong growth

Let me highlight some key figures for the year thus far, marked by a strong execution of the model.

Sales reached twenty-three (23) billion euros, nineteen percent (19%) higher versus the nine months of twenty twenty-one (2021). Sales were positive in all geographical areas and in store and online.

The control of operating expenses was rigorous, as they grew well below sales growth.

On the bottom line, net income increased twenty four percent (24%) to three point one (3.1) billion euros.

And our operations continue to generate strong cashflow.

Our diversified presence in two hundred and fifteen (215) markets with low market penetration allows us to enjoy significant global growth opportunities. We have complete confidence in the ability to grow our unique business model.

I will hand you over to Ignacio to go into the detail behind the headline numbers.

Slide 8: CFO

Slide 9: Financial Summary

Thank you, Oscar.

Slide 10: 9M2022: Very strong execution

As you have seen in our release, Inditex had a very strong execution in the nine months of 2022 despite a challenging environment.

As Oscar mentioned a few moments ago, sales, EBITDA and net income all reached historic highs in the nine months and the quarter.

Sales have progressed strongly at plus 19%. We have managed the supply chain actively, and this has driven a healthy gross margin. Operating expenses have of course been managed rigorously.

Net income increased 24% to 3.1 billion euros.

We continue generating a significant free cash flow, taking our net cash position to 10 billion euros.

Slide 11: Sales

Let me reiterate that sales have progressed very nicely at plus 19% reaching 23.1 billion euros and grew 20% in constant currency.

Sales have been positive across all regions.

In the first months of 2022, Inditex's traffic and store sales increased significantly. This trend continued as the year progressed, with store differentiation being key.

Online sales also progressed satisfactorily over and above the record nine months of 2021.

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INTERIM NINE MONTHS 2022

Based on current exchange rates we expect a neutral currency impact on sales for the full year 2022.

Slide 12: Gross profit

In the nine months of 2022, gross profit increased 19% to reach 13.5 billion euros and demonstrates a healthy execution of the business model. The gross margin reached 58.7%.

Based on current information, we expect a stable gross margin of +/-50 bps for 2022.

Slide 13: Operating efficiencies

There has been very rigorous control of operating expenses across all departments and business areas. Operating expenses increased below sales growth over the nine months of 2022. Including all lease charges, operating expenses grew 4 percentage points below sales growth.

Slide 14: Working capital

Inditex temporarily accelerated Autumn/Winter inventory inflows in the face of possible supply chain tensions throughout 2022 in order to increase product availability without any change to commitment levels. Due to this reason, inventory as of the 31st of October 2022 increased 27%.

The Autumn/Winter inventory is considered to be of high quality.

As of the 8th of December 2022, inventory levels were 15% higher.

Slide 15: Strong cash flow and financial condition

These actions, in conjunction with the strong cash flow, took the net cash position to 10 billion euros.

And now over to Marcos.

Slide 16: Capital Markets Director

Slide 17: Concepts

Thank you

Slide 18: Sales by concept

Over the nine months of 2022 we have continued with our strong expansion.

We have opened stores in 30 different markets and have progressed with optimisation activities across all concepts.

Slide 19: Performance per concept

We are pleased with the execution of the concepts over the nine months.

Store sales across all concepts have been robust. Online sales are above the record levels of the nine months of 2021.

Zara has generated an exceptional performance over the period. All the concepts have progressed strongly, especially Pull&Bear, Stradivarius and Bershka.

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