The world's biggest fashion retailing group, the Zara owner Inditex, trebled its profits last year across its Irish network of 23 stores.
The listed Spanish behemoth operates nine stores here under the Zara banner, as well as six Bershka, three Pull & Bear stores, three Stradivarius, and two Massimo Dutti outlets.
Accounts filed separately for the various brands over recent weeks illustrate the accelerating performance of Inditex’s Irish entities following the economic recovery, and their burgeoning profitability driven by increased online sales.
Za Clothing, which operates the nine Zara stores and employs 370 staff, recorded a 18 per cent increase in sales to €94.8 million in the year to the end of January 2018, its financial statements show.
The performance was boosted by the fact that from last June, Inditex redirected its brands’ online sales to Irish customers to the respective units that had previously only counted in-store sales.
Before this, Inditex had funnelled almost all of its global online sales through a single Irish company, ITX Fashion, which it has recently begun to wind down in the wake of criticism for using Ireland as a hub for its global tax planning.
The better margins in online retailing, compared to traditional bricks-and-mortar stores, are laid bare in the Irish accounts. Although Za Clothing only boosted its revenues by a fifth after it started handling Irish online sales, it almost trebled its net profits to €10.8 million.
The directors said they plan to open further Zara stores in Ireland “as soon as suitable opportunities arise”.
The company behind the six Bershka youth fashion stores, which include a Dundrum Town Centre outlet that was completely refitted last year, recorded a 15 per cent rise in revenues to €18.4 million. Profits more than doubled to €1.1 million.
Sales at the three Pull & Bear casual clothing outlets rose by almost a third to €7.9 million but, again, profits more than trebled to €1.2 million. Profits also increased by about 200 per cent at the Massimo Dutti stores, where sales rose by 10 per cent to €8.8 million.
Revenues at Stradivarius rose by 14 per cent to €5.8 million. Overall, Inditex generated sales last year from its Irish retail operation of almost €136 million, which is more than 50 per cent ahead of its revenues five years ago, when the retail recovery began.
Global sales at Inditex last year breached the €25 billion mark. In the listed company’s results announcement in February, it revealed that online sales were growing at more than 40 per cent annually.
Zara and Inditex were founded by Spanish tycoon Amancio Ortega. The group's chief executive Pablo Isla was recently listed as the best performing chief executive globally last year by Harvard Business Review.