// Zara full-year profits decline in the UK despite sales increase, according to the Mail on Sunday
// Full-year sales went up 10% to £772.5m
// Pre-tax profits plummets 56.9% year-on-year from £51.8m to £22.3m
Zara UK has posted a dramatic plunge in full-year profits in its UK market, despite sales increasing.
According to The Mail on Sunday, the fashion retailer saw full-year pre-tax profits plummet by 56.9 per cent from £51.8 million to £22.3 million.
Meanwhile, sales reportedly went up 10 per cent year-on-year from £704.8 million to £772.5 million.
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Dividend payments were also more than halved from £41 million the previous year to £17.5 million this year.
Inditex – the Spanish parent company of Zara – attributed the results to its selling and distribution costs, which increased seven per cent during the year.
Despite this, the retail conglomerate – which also owns Pull & Bear, Bershka and Massimi Dutti – said it would continue with plans to open more Zara stores in the UK as opportunities arise.
The news comes several weeks after Inditex revealed strong first-half growth for the whole company, with half-year sales topping €12.8 billion (£11.4 billion) for the first time.
In the six months to July 31, sales were up seven per cent year-on-year, while like-for-like sales were up five per cent.
Group-wide net profit also reached a new record of €1.6 billion (£1.4 billion) for the half-year period – up 10 per cent on the same period in 2018.