The textile giant Inditex has broken its sales and profit record in 2022 despite the challenges of a year marked by high inflation, the general rise in costs and the war in Ukraine. The multinational owner of brands such as Zara, Massimo Dutti or Bershka entered the last financial year (from February 1, 2022 to January 31, 2023) 32,569 million euros, 17.5% more than in 2021, when it registered sales of 27,716 million.
Thus, it exceeds the pre-pandemic figures, when it billed 28,286 million and earned 3,639 million. The net profit in this 2022 amounts to 4,130 million euros, Inditex has communicated this Wednesday to the CNMV. Operating expenses also increased by 15% compared to 2021 and the online business contributed 7,806 million to total billing.
The company thus closes a historic year, both in terms of results and due to the changes that its leadership has undergone and the exceptional closure of the Russian market. The new president of Inditex, Marta Ortega, youngest daughter of the founder, Amancio Ortega, is about to complete her first year in office – she took office on April 1, 2022 – after the departure of Pablo Isla from the company. The current CEO, Óscar García Maceiras, is also celebrating one year at the helm of Inditex.
During this time the company has closed its market in Russia. First with the cessation of its activity in the country on March 5, 2022, when it closed its 514 stores and its online platforms. This market constituted around 8.5% of the group’s global EBIT. All stores operated on a rental basis and employed more than 9,000 people. According to calculations by Credit Suisse, the country contributed close to 6% of Inditex’s sales.
In October Inditex announced an initial agreement to sell its business in Russia to the Daher group, a United Arab Emirates holding company specializing in retail and distribution. Daher belongs to the same owners of the Azadea group, which already operates franchises of the Galician company in the Middle East. At that time, Inditex did not report the price of the operation, which was still in the agreement phase, although it did estimate that the provision recorded in the financial statements in the first half of this year, of 216 million euros, “substantially covers the impact of the cessation of of activity” in the country. In addition, it opened the door to recover the activity one day in Russia if the circumstances arose.
As for Ukraine, all 82 stores and online platforms have been closed since February 24, 2022.
In the labor field, the multinational closed an agreement in February to equalize the salary conditions for the employees of all its stores in Spain. The pact signed with the UGT and CC.OO. establishes that the workers of the different brands will receive a minimum salary of 18,000 and 24,500 euros gross per year, depending on the position and seniority. The previous months it had experienced protests from its store employees in A Coruña, who demanded better wages, and strike calls in other parts of Spain.
By brands, Zara continues as the engine of Inditex, contributing 23,761 million euros to its revenue. In terms of markets, Spain accounts for 14.4% of sales, Europe, with 47.5%, fell slightly while revenue from America increased compared to 2021, with 20%. Asia represents 18.1% of total sales.
The record revenues of this last year have been achieved with 10% fewer stores and 6% less commercial space than in 2021, the group explained. Altogether, it made 201 openings, 186 reforms that include 94 extensions, and 349 absorptions. At the end of the 2022 financial year, Inditex operated 5,815 stores counting all its 213 markets.
The company chaired by Marta Ortega also sees opportunities to grow even more, especially in the United States. Between 2023 and 2025, Zara will undertake at least 30 projects in that country (new stores, relocations and expansions), in cities such as New York, Los Angeles, Miami, Chicago, Boston, Dallas, Austin and Las Vegas. In the chapter of investments for the whole year, it plans to spend 1,600 million euros. As a novelty, it prepares a new security system that will allow it to eliminate hard alarms from stores.
The dividend also increases. The Board of Directors will propose to the General Shareholders’ Meeting a 29% increase in the dividend up to 1.20 euros per share, made up of an ordinary dividend of 0.796 euros and an extraordinary dividend of 0.404 euros per share. The dividend is made up of two equal payments: the first on May 2, 2023 with a payment of 0.60 euros per share, corresponding to the ordinary dividend, and on November 2, 2023 a payment of 0.60 euros per share.
