Zara owner Inditex posts record profit

Published March 15th, 2023 - 08:59 GMT
Inditex profits
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ALBAWABA — Zara owner Inditex on Wednesday posted record profits for 2022 despite halting its second largest operations in Russia, surge in production costs and retail sales constricted by rising global inflation.


Net profit reached 4.1 billion euros last year, a 27 percent jump from 2021, said Inditex, whose eight brands also include younger fashion chain Pull&Bear, upmarket label Massimo Dutti, clothing retailer company Bershka, women's clothing fast fashion retailer Stradivarius, clothing retailer specializing in women's homewear and undergarments Oysho and home wares company Zara Home.


In-store and online sales hit a record, surging 18 percent from 27.71 billion euros in 2021 to 32.6 billion euros, exceeding pre-pandemic levels in the first full year since Marta Ortega, daughter of founder Amancio Ortega, took over at the helm of the company as chairwoman.


Online sales hit 7.8 billion euros, a 4 percent rise over the previous record set in 2021.


The company’s board of directors will propose to the annual general meeting a dividend increase of 29 percent to 1.20 euros per share.


"The excellent results of 2022 show the strength of our business model and its ability to move towards the next level of development in which our fashion proposition, the experience of our customers, our commitment to sustainability and the talent of our teams will continue to be key," said Inditex chief executive officer Oscar Garcia Maceiras.


At the end of 2022 Inditex operated 5,815 stores, after opening 201 stores in 33 markets and refurbishing 186 stores.


Inditex's results were principally in line with analysts' expectations and the company said it expects further growth in 2023 that will include enlargements of existing stores, opening new stores and relocations.


"We see significant long-term growth opportunities in the United States," Inditex said, planning to undertake "at least" 30 new projects in the United States between 2023 and 2025 in cities such as Boston, Chicago, Los Angeles and New York.


The chairwoman and Maceiras have opted to stick to Amancio Ortega's model "with small adaptations", Alfred Vernis, a former senior figure at Inditex and now professor at the Esade Business School, told Agence France-Presse.



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