Zara owner's focus on online platform delivers profit hike
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 quarters of 2019.
The retail group said that gross profits increased 8pc to €11.5bn for the nine months to October 31. Sales across the group jumped 7.5pc to €19.8bn, with trading steady across the period.
It said it now expects like-for-like sales to grow by between 4pc and 6pc during the full year.
The company, which also includes the Bershka and Pull & Bear brands, said it has been resilient against challenges in the sector due to tight control of inventory - avoiding major discounting.
The expansion of Inditex's 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 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".
Mr Isla said 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".