Spanish fashion group Inditex triples profits in financial year 2021

by Lorraine Williamson
Spanish retail group, Inditex - https://commons.wikimedia.org/wiki/File:Zara_Bruselas_16.jpg

MADRID – Spanish multinational Inditex, which includes brands such as Zara and Pull&Bear, had sales of €27.7 billion in the 2021 financial year. The net profit was more than €3.2 billion, almost triple that of 2020.  

This meant that the profit was only 11% below the record profit of 2019, the year before the pandemic broke out. 

According to the textile group’s statement to the Spanish stock market regulator CNMV, turnover increased by 36% compared to 2020 and reached €27.7 billion. With this, Inditex shows recovery after the pandemic, just before Marta Ortega takes over from Pablo Isla as chairman of the company founded by Amancio Ortega – Marta’s father.  

Internet activities on the rise 

Internet activities have grown by 14% and now account for 25.5% of the group’s total. The goal is to reach 30% by 2024. Despite the fact that there were 13% fewer shops, sales were 3% higher than in 2019. 

During 2021, commercial activities normalised again after the outbreak of the pandemic. But in the fourth quarter, the high number of infections caused by the Omicron variant again led to a drop in sales, with lockdowns in several countries resulting in €400 million less revenue. 

Countries and brands 

The Spanish company with the highest market value opened the 2022 financial year with a 33% increase in sales from 1 February to 13 March, 21% higher than the pre-2019 record. 

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 During the said period, sales in Russia and Ukraine increased by 5%, despite the Russian invasion of the neighbouring country and the subsequent closure of its more than 500 shops in Russia. 

In Russia, the Spanish group Inditex employs more than 9,000 people and accounts for around 8.5% of company profits. In Ukraine, Inditex had 85 shops at the end of the financial year. 

The United States was the second-largest market after Spain in 2021, with sales accounting for 14.4% of the total. Europe, excluding Spain, accounted for 48.4% of the group’s sales and North and South America showed an increase of 4% to 17.5%.  

Zara and Zara Home grew 39%, Pull&Bear 32%, Massimo Dutti grew 30%; Bershka 23%, Stradivarius 42%, and Oysho 15%. 

Goals for 2022 

By 2022, Inditex plans to invest approximately €1.1 billion (about $1.20 billion) and increase its shop footprint again. The plan to optimise its shops, which has seen 578 closed and 6,477 remaining, is as good as completed. 

The multinational, which describes itself as ‘one of the largest fashion distribution companies in the world’, was founded in 1963 as a small company in the Spanish province of La Coruña and now has branches in almost 100 countries. 

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