Inditex has another strong year, expects more of the same despite slower start to 2025

It’s big week for Spanish powerhouses to report their results and just a couple of days after Mango showed how strong it is, larger rival Inditex did the same.

On Wednesday, the company said that 2024 “continued with a very robust operating performance”. And CEO Oscar García Maceiras called its sales and profit figures “excellent”. 

So what exactly did it tell us in the annual results report for the 12 months to the end of January?

Its collections were “very well received by customers” as sales grew 7.5% to reach €38.6 billion, “showing very satisfactory development both in stores and online”. Sales, which were positive in all concepts, grew 10.5% in constant currency (CC).

Meanwhile gross profit increased 7.6% to €22.3 billion and the gross margin reached 57.8%. Also, control of operating expenses was “rigorous” and increased 6.5%, below sales growth.

EBITDA was up 8.9% at €10.7 billion and EBIT rose 11% to €7.6 billion. Profit before tax (PBT) increased 10.3% to €7.6 billion and net income increased 9% to €5.9 billion, “building on the strong growth over recent years”.

That’s an undeniably strong set of figures. But while annual sales rose at the aforementioned 10.5% CC, the first quarter of the new financial year has started more slowly with sales up just 4% CC from the start of February to 10 March. That period a year ago was up 11%.

But it said its SS25 collections are proving popular and it has to be pointed out that the February to early March period hast year had an extra trading day due to it being a leap year. Also, in the last week of trading, store and online sales on a CC basis have increased 7%

The company remains upbeat for this year with plans to add around 5% in new retail space and to invest €1.8 billion in space growth, tech and improving its online platforms. It also continues to invest heavily in improving its already-strong logistics ops.

2024 in focus

Looking at the 2024 figures in more detail, the company said store sales grew 5.9% “reflecting incremental footfall and increasing productivity”. That’s an impressive figure given that some other ultra-successful omnichannel fashion retail peers (such as the UK’s Next, for instance) can’t seem to match that kind of physical stores sales rise, despite overall growth being as good as Inditex’s.

The Spanish company said its “ongoing store optimisation and digitalisation programme continues to be key”. In fact, the higher level of store sales was achieved with only 2% more commercial space and 2.3% fewer stores than in 2023. In 2024, gross new space increased 5.8%.

Inditex opened stores in 47 markets in 2024, including its first stores in Uzbekistan, and remained very active in store optimisation activities (257 openings, 254 refurbishments which include 121 enlargements and 386 absorptions). At the end of FY24 Inditex operated 5,563 stores. 

Looking at its online ops, sales rose 12% to reach €10.2 billion and it said “customer engagement remains very high”. Active App users reached 218 million and online visits in the year grew 10% to 8.1 billion. The group also has 257 million followers on social media.

As for the sales figures for each individual store concept, the company said Zara and Zara Home sales rose 6.6% to €27.778 billion, with PBT of €5.407 billion compared to €5.044 billion the year before. 

Pull&Bear sales were up 4.6% at €2.469 billion with PBT rising to €458 million from €438 million, and Massimo Dutti sales rose 6.6% to €1.96 billion, while PBT jumped to €402 million from €339 million. Bershka sales leapt 11.8% to €2.93 billion and PBT rose to €548 million from €460 million. 

Stradivarius sales were up an even better 14.1% at €2.664 billion and PBT rose to €616 million from €493 million. Oysho sales rosę 11.8% to €831 million with PBT at €146 million compared to €136 million in the previous year.

And by geography, the company said that 50.6% of store and online sales were accounted for by Europe (excluding Spain) in the latest year, compared to 48.7% a year earlier. Sales to America had an 18.6% share, down from 19.6%, while Asia and the rest of the world were at 15.7% compared to 16.9%. The share of sales to Spain was 15.1% against 14.8% in the previous year.

2025 priorities

Inditex said that it continues to see strong growth opportunities and its main priorities “continue to be the improvement of our fashion proposition and the customer experience, the clear focus on sustainability and taking care of the talent and commitment of our people [to] drive long-term growth”.

Regarding its stores, Zara is launching in new locations (Nanjing Xinjiekou, Athens Minion, Eindhoven Rechtestraat and Osaka Umekita), and it’s opening new standalone Zara Man stores such as Zúrich Bahnhofstrasse. 

The rest of the concepts also continue to open new space, such as the recently opened Bershka store in Mumbai Palladium, and Pull&Bear, which will open soon on Oxford Street in London.

The group will also launch its first stores in Iraq. Bershka will open its first stores in Sweden, while Bershka and Massimo Dutti will debut in Denmark. Stradivarius will open its first store in Austria, and Oysho will debut in The Netherlands and Germany.

It will continue introducing the new soft tag alarm technology in its stores too, saying the new tech is “a significant improvement in customer experience, facilitating interaction with our products and improving the purchasing process”. The system is fully operational in Zara, and will be available in Bershka and Pull&Bear this year.