Zara sales soar as brand boosts global reach

Spanish textile giant Inditex, owner of the Zara brand, announced on Wednesday a rise in quarterly profit as it pursued a global expansion with a string of new stores including in Japan, China and Russia.

Zara sales soar as brand boosts global reach
Zara has opened a slew of new stores in Istanbul, Prague, Bologna, Marseille, Jaipur and many other cities. Photo: Zara Online

The spread of Inditex's worldwide reach boosted sales by 5.2 percent from a year earlier to €3.59 billion ($4.8 billion) in the three months to April 30, the first quarter of the firm's 2013 business year.

Net profit climbed 1.4 percent to €438 million in the same period.

"The group's various retail formats forged ahead with their international expansion plans," with most new stores opening in Russia, Japan and China, Inditex said in a statement.

Inditex said the number of stores had grown by 49 in the quarter to reach 6,058 by the end of April.

"The group has created more than 10,000 jobs worldwide in the last 12 months and has forged ahead with its investment plans for Spain," where facilities were being expanded, it said.

Zara Home, a home furnishing store, opened debut stores in the Japanese cities of Osaka and Yokohama, as well as in Panama, it said.

The fashion outlet Zara opened a slew of new stores, notably in Istanbul, Prague, the Italian city of Bologna, the French port city of Marseille and the Indian city Jaipur. The Pull & Bear brand opened its first store in Germany.

Zara now sells its products online in 23 countries in Europe, the United States, Japan, China and Canada and the outlet plans to launch online shopping in Russia in the autumn of this year, Inditex said.

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Amancio Ortega’s daughter to take over as Zara and Inditex boss

Marta Ortega, daughter of Spain's wealthiest man, will take over as chairwoman of the world's biggest fashion retailer in a generational shift for the firm, Inditex announced on Tuesday.

Amancio Ortega's daughter to take over as Zara and Inditex boss
Photo taken in 2016 shows the founder and chairman of the Inditex fashion group Amancio Ortega (R) with his daughter Marta Ortega. Photo: MIGUEL RIOPA / AFP

She will replace Pablo Isla, who has been chairman since 2011, in April, the company said in a statement. He was deputy chairman between 2005 and 2011.

Ortega, 37, has been working for the company in different areas for the last 15 years, even working anonymously as a shop employee at one point to learn the ins and outs of the company.

She is the youngest daughter of Amancio Ortega, 85, who founded fast-fashion giant Zara with his ex-wife Rosalia in 1975 in Spain’s northwestern region of Galicia.

He remains the firm’s largest shareholder with a 59 percent stake and is one of the world’s richest men.

“I have lived and breathed this company since my childhood, and I have learned from all the great professionals I have worked with over the last 15 years,” Marta Ortega said in the statement.

“I have always said that I would dedicate my life to building upon my parents’ legacy, looking to the future but learning from the past,” she added.

Inditex, which operates nearly 7,000 stores worldwide, posted a net profit of almost 1.3 billion euros ($1.5 billion) during its first half of 2021, which runs between February and July.

The fashion group owns seven other brands in addition to Zara, including upmarket Massimo Dutti and teen label Stradivarius.

It is the world’s biggest fashion retailer, ahead of Swedish rival H&M.

Stocking shelves

Inditex thanked Isla, who is resigning, for his “leadership and vision” during his 17 years at the firm, saying the group had become “the leading company in its sector worldwide” under his watch.

It also hailed Marta Ortega, saying she “has led the strengthening of Zara’s brand image and fashion proposition, an area she will continue to oversee.”

She studied international business in London and carried out months-long stays in the departments of finance, accounting, sales analysis and design when she began working at Inditex.

Marta Ortega also briefly worked as an anonymous employee at the group’s shops in 2007, reportedly stocking shelves, to get a better understanding of how they operate.

Oscar Garcia Maceiras, who had become the company’s general counsel and secretary of the board in March, will become CEO “effective immediately”, Inditex said.

Her will replace Carlos Crespo, who took the post two years ago. Crespo will remain chief operating officer.