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Spain’s Inditex posts small profit rise after ‘extraordinary expansion’

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Fashion distributor Inditex, who owns the Zara clothes chain, posted a 5 per cent sales rise for the nine months to 31 October 2013.

Having battled currency instabilities in its home country the Spanish giant has focussed expansion into emerging markets such as Ecuador, Georgia and Armenia.

It said sales would have rose 8 per cent without local currency effects.

Net sales were 11.93bn euros and profits edged up 1 per cent for the period.

Indidex, who opened up 240 net larger new stores in 54 markets and enlarged more than 100 flagships during the first nine months of 2013, has refurbished its Zara flagships on London’s Brompton Road, the Grand Via in Madrid and the Champs Élysées in Paris.

It said in a statement that it expects future business growth to come from online.

David Alexander, retail consultant at Conlumino said the firm has seen an “extraordinary period of expansion” in recent years.

He added: “Such outstanding growth was always likely to be unsustainable in the long term and to some extent the group has been a victim of its own success as it has meant each new set of financial results must face off against tough comparatives.”

Published on Wednesday 11 December by Editorial Assistant

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