Paul Islandpresident of the Inditex group and who will be replaced by Marta Ortega after 17 years in office, has shared the economic and financial results of the textile manufacturing and distribution company during the 2021 financial year. The results show that the company founded by Amancio Ortega has reversed the crisis caused by the COVID pandemic, after registering a profit of 27,716 million euros, 36% more than in 2020. “After two years of the pandemic, these results demonstrate the great solidity of the company, the strength of the business model and the quality of our team”, explained Isla.
However, the negative note is taken by the clients and users of Inditex in Spain due to a 2% rise in prices of the products that will be launched for the spring-summer campaign, while globally it will be 5% due to the risk of inflation faced by many world markets.
“There are inflationary tensions and the company wants to maintain margins and make the necessary adjustments”, said the president of Inditex. Furthermore, he has reiterated that the main policy of the textile company is price stabilitybut what “in those countries with a temporary impact of significant inflation”they are obliged to modify the value of the products on the rise.
Spain, first market for sales
Also, they have been detailed the turnover levels of those countries that have Inditex stores in their geography, among them stands out Spain, with 14.4%, followed by other European countries, with 48%, America, 17.5% and Asia, 19.7%. As for the textile chains, the Zara brand leads the ranking with more than 39% of salesincluding your household goods section (Zara Home), then they meet Pull & Bear, 32% and Massimo Dutti, 30%.
What’s more, the outbreak of the pandemic caused a growth of up to 14% in Inditex’s online saleswith a turnover of up to 7,500 million euros, more than 25% of total sales of fiscal year 2021. Regarding the financial position, has increased to 24%, which represents “a new all-time high”Meanwhile he operating profit is 7,183 million euros, 57.8% more and operating profit has increased by up to 180%according to the company document.
What will happen to the stores in Russia?
Inditexlike other textile companies, decided close all its stores distributed in Russia, as well as suspend operations for online sales. “Inditex informs that in the current circumstances cannot guarantee the continuity of operations and business conditions in the Russian Federation and temporarily suspends its activity in all 502 stores and on the country’s online channel“, proceeded the company.
Oscar Garcia MaceirasCEO of Inditex, has confirmed that they plan resume activity in Russia “when the situation allows”since the suspension is “temporary”, according to account. Likewise, he has also been asked about if they have received any notification from the Kremlin about the measure imposed, but it has not given details. Similarly, he has pointed out that Russia is one of the most important countries for the company, since it generates 8% of the net operating profit and they have more than 9,000 workerswho are without work, but continue to receive their salary, according to the company.
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