Inditex SA (ITX.MC), Europe's top fashion retailer by revenue, Wednesday said it plans a major push online for its flagship Zara-brand, as it reported better-than expected first-half earnings.

Amid continued weakness in its main Spanish market, the owner of brands such as Pull and Bear, Bershka and Massimo Dutti said its net profit fell 7.6%, due mainly to costs associated with new store openings around the globe. But that easily beat analysts' expectations.

The retailer also gave a resilient trading outlook, saying sales in the first weeks of its fiscal third quarter were up 9% in local currencies, the same growth rate as in the first half.

Inditex, which sells its garments in 73 countries, is filling racks at its flagship Zara stores this autumn with "shabby-chic" leather and mock fur jackets and slim fit, tapered pants. It also has a casual collection featuring jeans and miniskirts and checkered flannel dresses.

The company is known for its savvy use of information technology to keep tight control of production and inventories. It collects data from its 4,400 stores to detect trends and tweaks products based on consumer tastes thanks to customer feedback.

It is, however, something of a latecomer to the Internet compared to its main competitor, Sweden's Hennes & Mauritz AB (HM-B.SK), so Inditex caught many by surprise Wednesday when it said it will launch online sales for Zara for the Autumn/Winter 2010 collection.

"There had been some concern that Inditex was falling behind competitors on e-commerce," said Anne Critchlow of French brokerage Societe Generale.

Inditex started operating an online store for its home furnishing concept Zara Home in 2007, but had earlier shied away from the net for Zara because of the complexity of managing and selling its fast-changing collections online.

In the medium-term, the group may also launch its other six formats online, said Chief Executive Pablo Isla.

"The Internet is becoming a more and more relevant channel, so it would be logical to continue expanding online with the other formats," Isla said.

The company plans to launch the online store www.zara.com initially in Spain, France, Germany, Italy, the U.K. and Portugal. Later, it will roll it out in all of Zara's remaining markets.

Neither H&M nor Inditex disclose how much of sales come from their online outfits. However, for U.S. rival Gap Inc. (GPS), about 8% of its Gap-branded sales in the U.S. were online.

In the U.K., online-only fashion retailer Asos Plc (ASC.LN) more than doubled its annual sales last year, which suggests that online could work well for Zara, noted Societe Generale's Critchlow.

At 1138 GMT, Inditex shares were up 4.1% or EUR1.6 at EUR40.23. The stock has risen 30% in value since the start of the year, as Inditex and other fashion retailers gained in popularity in tandem with a stabilizing global economic outlook.

The group's relatively cheap, but still fashionable garments have also drawn in cost-conscious shoppers during the downturn.

Net profit in the six months from Feb. 1 to July 31 dropped to EUR375 million from EUR406 million a year earlier, comfortably above market expectations of EUR349.9 million.

Total sales for the period were roughly in line with expectations, rising 6.6% to EUR4.86 billion. Inditex opened 166 new stores in the first half, down from 249 stores in the same period last year.

Like-for-like sales - the measure which excludes newly-opened stores, and which comprises 81% of total store sales - shrunk by an annual 2% in the first half, compared to a decline of 0.7% in the second half of last year.

CEO Isla said he hoped for "better" like-for-like sales in the second half than in the first half.

That compared favorably to smaller U.K. rival Next, who said it is "conservatively planning" for retail like-for-like sales to be down between 3.5% and 6.5% in the second half, while directory sales - its catalogue-shopping and online business - will be either flat or up 2%.

Morgan Stanley's Fred Bjelland said the statement likely will surprise "even the most bullish of commentators." He added: "It suggests both that cost savings are coming through earlier than expected and that trading remains strong."

Operating costs in the first half grew 8% as Inditex continued to expand its empire. The group had a total of 4,430 stores at the end of the fiscal first half.

The gross margin - a key yardstick to measure a retailer's profitability - fell to 55.3% of sales from 56.4% a year earlier. Analysts said the stronger dollar is making it more costly to source materials, while it's also suffering pricing pressures in its main market, Spain.

Company Web site: www.inditex.com

-By Christopher Bjork, Dow Jones Newswires, +34 91 395 81 23, christopher.bjork@dowjones.com