Zara feels the Marta effect as founder’s daughter boosts profits by a quarter
Zara’s profits soar as the fashion industry thrives under the leadership of Marta Ortega Perez.
Profits for the first nine months of 2022 jumped by a quarter to £3.4bn. Sales rose by a fifth to £20bn as shoppers bought its autumn and winter ranges.
The barnstorming results come despite owner Inditex pushing prices up an average of 5% this year.
Soaring profits: Zara boss Marta Ortega Perez (pictured) took over from her father Amancio Ortega in April
The results are a boost for the new boss, 38, who in April took over as chairman from his father Amancio Ortega, who set up Zara in Galicia, Spain, in 1985.
Inditex has since had a good run, with Jefferies analyst James Grzinic saying it “makes things look easy”.
Shares rose 3% in Madrid after yesterday’s update. They have fallen by about a tenth this year due to fears over sales.
But chief executive Oscar Garcia Maceiras said: “These results clearly reflect the strength of our unique business model: fashionable collections, an engaging shopping experience and a team committed to profitable and more sustainable growth.”
Inditex said its autumn and winter collections had been “very well received”, as customers across Europe braced for a cold winter. The retailer said there had been a “marked” increase in shoppers.
But despite trading remaining strong, Inditex said sales growth had slowed as Christmas approached, although sales since the start of November were 12% higher than the same period l last year.
Victoria Scholar, Head of Investments at Interactive Investor, said: “Inditex is not immune to the deteriorating economic outlook, with the threat of a recession putting pressure on the consumer and weighing on retail sales. Christmas is approaching. Zara tried to attract high-end customers.
“It branched out into skiwear and lingerie.”
Prior to her promotion, Marta Ortega had worked at the company for 16 years, starting at age 22 as a sales associate in London.
There has been little change in strategy since the reshuffle, although it has been credited with improving the band’s fashion and strengthening its brand.