Inditex profits surge in European recovery sign

Inditex profits surge in European recovery sign
Pablo Isla, CEO of Inditex arrives to deliver results in Arteixa on Wednesday. Photo: Miguel Riopa / AFP
Spanish clothing giant Inditex, owner of the Zara brand, said Wednesday its profits rose five percent last business year, driven by recovery in its key European markets.

The rise brought its net profit to 2.5 billion euros ($2.65 billion), the group said in an earnings statement on its 2013-2014 financial year ending in January.

It said net sales rose eight percent to 18.12 billion euros. Inditex is the biggest clothing firm in the world by sales.

Europe accounts for two thirds of Inditex's sales but it is expanding worldwide.

It opened 343 new stores in 2014 including in Shanghai and Miami, bringing the total to 6,683 stores worldwide include high street brands such as Massimo Dutti and Bershka. 

It said it hired more than 8,700 new staff last year, including 1,800 in its home market and logistic base Spain, which is gradually recovering from an economic crisis.

"We continue to see huge growth opportunities in both western and eastern Europe," said its chief executive Pablo Isla.

"We believe that Inditex is in an excellent position to take advantage of global growth opportunities," he told a news conference Wednesday at Inditex's headquarters in northwestern Spain.

The company said it planned to further expand this year by opening up to 480 new high street shops, including a flagship store in New York's SoHo district and one in London's Oxford Street.

Inditex shares were 2.31 percent higher in mid-morning trading Wednesday on the Madrid stock exchange, whose key index was slightly down overall.

The results come a few days after the fortune of Amancio Ortega, founder of the Zara clothing store chain, reached a new financial milestone.

The fortune of Spain’s wealthiest man surpassed the €60 billion mark for the first time on Monday thanks to the rising share price of Inditex.

when his fortune moved past the €60 billion mark for the first time on Monday.

Spain´s wealthiest man is now even richer thanks to the rising share price of Inditex, the textile giant he created in 1985.

The Galician-born creator of the textile company that was started in 1985 holds a 59.29 percent stake in the group, whose shares were trading at a historic high of €28.81 on Monday in anticipation of Wednesday's year end results.

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