Spanish textile company Industria de Diseno Textil or Inditex, the world’s largest clothing retailer, saw full-year profit shoot up on the back of continued worldwide expansion as the company launched online stores for all its concepts and opened the first Zara stores in Australia, Taiwan, Azerbaijan, South Africa and Peru.
The owner of the Zara and Massmo Dutti brands announced today (21 March) that net profit rose 12% to 1.93bn euros, or $2.68 billion over the year ended 31 January, from 1.73 bn euros a year ago. Net sales rose 10% year-over-year to 13.8 billion euros, or $19.15 billion and increased in all geographic areas, namely Spain, the rest of Europe, the Americas, Asia and the rest of the world. Net sales in local currencies rose by 11%, while like-for-like store sales climbed by 4%. Between Feb. 1 and March 14, store sales in local currencies, adjusted for the leap year effect, were up 11 percent. The gross margin stood at 59.3 percent of sales, unchanged from the previous year.
The retailer opened 483 units in 2011, bringing its total to 5,527 doors on five continents. It opened stores across 49 markets and entered five, including Australia, Taiwan, Azerbaijan, South Africa and Peru. Inditex added 132 stores in China, 15 in Japan and 13 in South Korea, making Asia one of its most rapidly expanding markets. The company also announced plans to launch an online store in China during the next winter season.
In Europe, the company opened 233 new stores and now has e-stores in 18 countries. Inditex added 50 stores in Poland, 49 in Russia, 21 in Romania, 21 in Turkey and 17 in Italy. Overall, the firm created 9,374 new jobs and closed the year with 109,512 employees.
The company said that its Australian, South African and Peru market entries represent further progress on the differential retail strategy it applies to markets in the Southern Hemisphere. “These collections, customised for southern countries’ seasons, drew a warm welcome from shoppers at the new Zara stores in Sydney, Melbourne, Johannesburg and Lima,” Inditex said.
Further, the Board of Directors will submit a proposal to the Annual General Meeting of Shareholders for 12.5% increase in the company’s dividend, to a total of 1.80 euros per share. This dividend will consist of a 0.90 euro per share interim dividend payable on May 2 and a 0.90 euro per share final and extraordinary dividend payable on November 2.
In 2012, Inditex plans to open between 480 and 520 stores, including its most recent Zara flagship on Fifth Avenue in New York, unveiled last week.
In Madrid, Inditex shares are currently trading at 72.22 euros, up 0.48 euros or 0.66 percent.