Zara owner profits soar on international expansion

Spain’s Inditex, the world’s largest fashion retailer and owner of the Zara brand, yesterday posted bumper profits for the first quarter as it pursued an ambitious programme of international expansion.

Profits for the February-to-April period totalled €332 million, up 10.3 per cent from last year.

Sales leapt 11 per cent to €2.96 billion while earnings before interest, taxes, depreciation and amortisation (EBIDTA) were up seven per cent at €601 million.

The group said it opened 110 stores in 29 different countries during the quarter, bringing the total to 5,154 as of April 30, “providing a snapshot of the global growth potential of the Inditex Group’s retail concepts”.

They included the opening of Zara’s first store in Australia, which increased the number of countries where Inditex sells its products to 78.

Inditex, whose other brands include youth label Bershka and the upmarket Massimo Dutti, also plans its first stores in South Africa, Taiwan and Peru before the end of the year.

It said e-commerce operations of Zara, currently present in 16 European countries, will begin in the United States from September 7.

In the financial year ending January 31, Inditex reported a 33 per cent jump in profits to €1.73 billion. Asia was the fastest growing revenue source during the year, expanding its share to 15 per cent from 12 per cent.