The Spanish clothing giant Inditex, owner of the Zara brand, saw its profits soar by 40% and reach a record level in the first half, thanks to the dynamism of its sales, stimulated by price increases. Over its staggered financial year, which ended on July 31, the world leader in inexpensive clothing generated 2.51 billion euros in net profit compared to 1.79 billion in the first half of 2022, according to a press release published on Wednesday . This result, the highest in the group’s history, is higher than the expectations of analysts surveyed by financial information provider Factset, who expected profits of 2.42 billion euros.
Also read: The excesses of fast fashion visible from space: this photo of a huge textile dump in Chile
The group explains this dynamic by the strong increase in its sales, which reached 16.85 billion euros, or 13.5% more than over the same period of 2022, with a “very satisfactory development both in stores and on the market. Internet”. Its operating profit (Ebitda) for its part amounted to 4.66 billion (15.7%). The figures for the first half of the year, achieved in a complicated global context, illustrate “the progress” made in terms of economic “performance”, welcomes the general director of Inditex, Oscar García Maceiras, in the press release. Inditex, owner of seven brands, including Zara, Bershka and Massimo Dutti, has indeed suffered from the war in Ukraine, which led it to sell its 514 stores in Russia, until then its second largest market in the world after Spain.
The group with 165,000 employees has also seen its production costs rise due to global inflation in the energy and transport sector, which it has decided to compensate with progressive price increases. This inflation led last winter to an unprecedented social conflict within the group, which accepted salary increases in several countries in mid-February in order to compensate for the drop in purchasing power of its employees. In view of the good results for the first half of the year, the textile group – led since the beginning of 2022 by Marta Ortega, daughter of the multi-billionaire and founder of Inditex Amancio Ortega – indicates that it is confirming its objectives for 2023, with “strong growth opportunities”.
