Bumper payday for Amancio Ortega as profits at Zara parent Inditex jump 10 per cent
The owner of Zara, Pull & Bear and Massimo Dutti has reported a 10 per cent increase in full year net profit – leaving founder Amancio Ortega, one of the world's richest men, with a bumper €1.3bn (£1.1bn) payout.
Profits at Inditex, the world's largest fashion retailer by sales, rose from €2.88bn to €3.16bn in the year to the end of January, with sales increasing 12 per cent to €23.21bn. It pointed to the strengthening euro for the rise, saying about 55 per cent of its sales are not in euros.
Earnings before interest and tax increased eight per cent to €5.08bn. The company plans to increase dividend payout by 13 per cent to €0.68 per share.
It added that at constant exchange rates, sales rose 13 per cent between the beginning of February and mid-March.
The company said it plans to shutter 150 to 200 of its smaller stores and open up to 500 new larger ones which, combined with online retail, will attract more customers and further boost sales. In 2016, 279 new stores were opened, and is currently at a total of 7,292 stores in 93 markets.
In 2015 profits rose 28 per cent, and have been relatively consistent during the past year.
Pablo Isla, chairman and chief executive of Inditex, said: “These are a positive set of results against a backdrop of strong prior-year performance. This is a direct result of the commitment, spirit and ambition of all the professionals comprising the group, their dedication to the company, passion for fashion and focus on sustainability.”