Monday 23 October 2017

Store revamp hits profits at Zara as it eyes new openings

Zara fashion
Zara fashion

Gordon Deegan

The temporary closure of its flagship store at Dundrum for a major revamp last year hit profits at main street brand Zara.

New accounts show that pre-tax profits at the firm last year fell by 17pc to €3.96m.

The drop in profits came in spite of revenues increasing from €62.47m to €69.27m in the 12 months to the end of January this year.

Zara operates a number of stores in Dublin, including its outlet at the Dundrum Town Centre, along with stores in Cork, Limerick and Galway.

According to the directors' report, they plan to "open further stores as soon as opportunities arise and for the company to increase profitability as a result of the continuing increase in sales".

Numbers employed by Za Clothing increased from 316 to 327 with employment costs going up from €9.9m to €10.63m.

The company's cash last year decreased sharply from €21.28m to €11.3m.

The firm paid a dividend of €9m to its Spanish parent.

All of the firm's revenues are generated from its nine stores in Ireland and the profit takes account of non-cash depreciation costs of €1.3m.

The company's operating lease rentals rose sharply from €7.5m to €8.96m.

The firm's shareholder funds last year topped €16m with accumulated profits totalling €1.6m.

Irish Independent

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