Online expansion drives Zara owner Inditex to higher profits
The owner of Zara has seen profits surge as the fashion retailer shrugged off the demise of the UK high street.
Inditex, the Spanish owner of the chain, said an increased focus on its online platform helped to cut costs and boost profitability over the first three quarter of 2019.
The retail group said that gross profits increased 8% to 11.5 billion euro (£9.7 billion) for the nine months to October 31.
Meanwhile, sales across the group jumped 7.5% to 19.8 billion euro (£16.7 billion), with trading steady across the period.
It said it now expects like-for-like sales to grow by between 4% and 6% during the full year.
The company, which also has brands including Bershka and Pull & Bear, said it has been resilient against challenges in the sector due to tight control of inventory, which has helped it avoid major discounting.
It said the expansion of its online platform in new territories, such as South Africa, Ukraine, Philippines and Colombia, has helped it to grow revenues in new markets.
During the period, Inditex also closed a number of smaller store units as it moved focus towards larger spaces in prime shopping areas.
Pablo Isla, executive chairman of the group, said the positive figures were a result of “the excellent performance of the entire Inditex team, whose commitment is enabling the delivery of continued sustained growth in our integrated stores and online model”.
He added that growth has been maintained “thanks to selected locations, store environments, products and customer experience of the highest quality, underpinned by a significant investment in technology and focus on leading and embracing the best sustainability practices”.