LONDON — Net profit at Zara parent Inditex nearly tripled to 3.24 billion euros in fiscal 2021, as revenues climbed 35.8 percent to 27.7 billion euros. Online accounted for a bigger share of revenue than ever in the 12 months to Jan. 31, the Spanish giant said Wednesday.
Inditex’s executive chairman Pablo Isla noted that “after two years of pandemic, this set of results demonstrates” the company’s ability to adapt to challenging circumstances.
The group’s chief executive officer Óscar García Maceiras flagged the digital transformation at Inditex in recent years, and said the company was in an “unrivaled position to offer an exceptional level of engagement with our quality, sustainable fashion.”
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The company said the performance through 2021 was shaped by the COVID-19 pandemic, with store trading hours in the first quarter 24 percent below capacity due to health restrictions.
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Inditex said that once the pandemic abated last spring, sales rebounded strongly and the group reported record levels of earnings in both the second and third quarters.
In 2021, revenue from online sales amounted to 7.5 billion euros, up 14 percent year-over-year. Inditex had seen the channel grow 77 percent in 2020.
Inditex said online sales now account for 25.5 percent of total group sales, and that figure is expected to reach 30 percent of total sales in 2024, making the Spanish fashion giant one of the world’s largest e-commerce players.
Gross margin stood at 57.1 percent, the highest level in six years, while EBITDA amounted to 7.18 billion euros and EBIT was 4.28 billion euros, demonstrating year-over-year growth of 57.8 percent and 184.2 percent, respectively.
Net cash rose to 9.36 billion euros, which was a record high, Inditex said.
The board of directors said it will ask the company’s shareholders to approve a dividend of 0.93 euros per share, up 33 percent from 2020. In addition, the board has agreed to pay an extraordinary dividend of 0.40 euros per share for 2022, which will be added to the ordinary dividend to be paid out over the course of 2023.
From a sales point of view, fiscal 2022 started with double-digit growth, with store and online sales between Feb. 1 and March 13 up 33 percent compared with the same period in 2021. They were 21 percent higher than the record pre-COVID-19 levels of 2019, Inditex said.
As reported, Inditex has closed all its stores in Ukraine and prioritized the safety of its workers in the region. The group has also paused its activity in Russia “due to the inability to guarantee operations.”
In the Feb. 1 to March 13 period, sales in stores and online in the Russian Federation and Ukraine represented approximately 5 percentage points of sales growth, Inditex said.