Inditex Group sales revenue rose by 8% in fiscal 2014; employees to participate in a special profit sharing plan in the next 2 years

Arteixo, Spain, 2015-3-19 — /EPR Retail News/ — The Group announces a special profit sharing plan under which employees will participate in earnings growth in the next two years

The profit sharing scheme will benefit all of the Group’s store, manufacturing, logistics, concepts and subsidiaries employees all over the world, so long as they have been working for Inditex for at least two years, which means some 70,000 beneficiaries in 54 markets

In 2014 the Group generated 8,741 new jobs worldwide, 1,800 of which in Spain. Inditex’s headcount totalled 137,054 at 31 January

  • Same-store sales growth was 5%; in the last five years growth in this key performance indicator stands at 23%
  • Net profit totalled €2.5 billion, year-on-year growth of 5%
  • In 2014 the company continued to invest in growth, spending €1.4 billion to process automation, store modernisation and adaptation of its logistics platforms to cater to new demand challenges
  • Over the course of the year Inditex opened 343 stores in 54 markets, bringing its network total to 6,683
  • Online sales operations were launched in South Korea and Mexico last year, lifting the Group’s e-commerce footprint to 27 markets. In 2015 Inditex plans to launch online sales in Taiwan, Hong Kong and Macao
  • Over half of the Group’s stores have already adopted the eco-efficient model which delivers average energy savings of 32% with respect to conventional stores
  • The Board of Directors will ask the company’s shareholders to approve a €0.52 per share dividend, year-on-year growth of 7.5%, at the upcoming Annual General Meeting
  • Store sales increased by 13% in constant-currency terms between 1 February and 14 March 2015

Inditex Group sales revenue rose by 8% in fiscal 2014 (1 February 2014 – 31 January 2015) to €18.12 billion. Net sales in local currencies increased by 11% in FY14. Same-store sales growth was 5%, implying like-for-like store sales growth in the last five years of 23%.
Net profit came to €2.5 billion, growth of 5% from 2013, while EBITDA rose 5% to €4.1 billion.

Key figures
(Billion Euros) 2014 2013 14/13
Net sales 18,117 16,724 8%
Gross Profit    Gross margin 10,56958.3% 9,92359.3% 7%
EBITDA 4,103 3,926 5%
EBIT 3,198 3,071 4%
Net profit 2,501 2,377 5%
Other performance indicators
Number of stores      Net openings 6,683343
Number of markets 88
Employees 137,054

In 2014, the Inditex Group created 8,741 new jobs and its headcount went from 128,313 to 137,054. Of these, over 1,800 were created in Spain, between its sales network, central headquarters and logistics platforms, in order to support the Group’s global growth.

Special profit-sharing plan. In view of the performance of the Group over recent years, a special profit sharing plan has been approved under which employees will participate in Inditex’s earnings growth in 2015-2016. All employees at stores, manufacturing, logistics, concepts and subsidiaries around the world who have been with the Group for more than two years will be eligible. The Group will award these beneficiaries 10% of the year-on-year growth in consolidated profit attributable to the controlling company up to a cap of 2% of total profit. The beneficiaries number around 70,000 people in 54 markets.
The scheme will run for two years. Part one will be collected in 2016 on the basis of year-on-year growth in Group net profit in 2015. Part two will be collected in 2017, following the same criteria. The plan will accrue in 2015 and 2016.

Capital expenditure. Capital expenditure totalled €1.4 billion in 2014 for the automation of processes and modernisation of the Group’s facilities in Spain. Some of the most noteworthy investments include the start-up of Inditex’s new logistics platform in Cabanillas (Guadalajara, Spain), generating almost 300 new jobs, and culmination of the expansion work at the Arteixo head office complex with the opening of the new Technology Centre. This centre, which is equipped with world-class technology, has been certified under the highest IT security and environmental sustainability standards.

The bulk of capital expenditure continues to be earmarked to new store openings and the refurbishment and expansion of existing establishments. Here it is worth underscoring the one-off investment made to purchase a building in New York’s SoHo which will house a new flagship Zara store.

New store openings. Inditex ended 2014 with 343 more stores that at year-end 2013 for a total network of 6,683 establishments in 88 markets, having entered the Albanian market during the year. In total it opened new establishments in 54 markets worldwide. Some of the most noteworthy openings included flagship Zara stores in Zurich (Bahnhofstrasse), Miami (Lincoln Road), Madrid (Serrano), Krakow (Rynek Glowny), Hong Kong (Queens Road) and Shanghai (East Nanjing Road) to bring its total number of stores in China to over 500 across 60 cities.

The Group’s other chains also opened high-profile stores such as the Pull&Bear stores in Milan (Vittorio Emanuelle II) and Amsterdam (Kalverstraat); the Massimo Dutti stores in Vienna (Kholmarkt) and Palma de Mallorca (Born); the Bershka store in Turin (Via Roma); the Uterqüe store in Madrid’s airport; the Stradivarius store in Osaka (Shinsaibashi); the new image Uterqüe store in Barcelona’s airport; the Oysho store in Barcelona (Pelai); and the Zara Home flagship in London (Kensington High Street). In 2015, Zara Home has opened its debut stores in Australia, making it the second Group chain to boast a presence in this region.

New stores planned for this year include prominent openings on Oxford St. 61 (London), in Plaza Cataluña (Barcelona) and a number of openings in various US cities, including three in New York: one on Fifth Avenue and 42nd street, inaugurated last week, another in the new World Trade Centre, in the heart of the New York’s financial district, and a third in SoHo, in a building recently acquired by the Group.

Also in 2014, the Group rolled out online stores for the chains with a presence in South Korea and Mexico and is planning to add Taiwan, Hong Kong and Macau to the e-commerce platform in 2015 (see Appendix).

Dividend. Inditex’s Board of Directors will ask the company’s shareholders to approve a €0.52 per share dividend, marking year-on-year growth of 7.5%, at its Annual General Meeting in July. A dividend of €0.26 per share will be paid out in the interim on 4 May 2015, and the remaining €0.26 per share would be paid out, if approved, on 3 November 2015 in the form of a final and special dividend.

2015 update. Store sales in constant currency terms rose by 13% between 1 February and 14 March 2015.

AppendixGlobal online sales platform

(in bold the online stores that went live in 2014)

Austria Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
Belgium Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
Canada Zara, Massimo Dutti, Zara Home
China Zara, Pull&Bear, Massimo Dutti, Bershka
Denmark Zara, Pull&Bear, Massimo Dutti, Zara Home
Finland Zara Home
France Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
Germany Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
Greece Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
Ireland Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Zara Home,Uterqüe
Italy Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home
Japan Zara
Luxembourg Zara, Pull&Bear, Massimo Dutti, Stradivarius, Oysho, Zara Home, Uterqüe
Mexico Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home
Monaco Zara, Pull&Bear, Masimo Dutti, Zara Home, Uterqüe
Netherlands Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
Norway Zara, Massimo Dutti, Zara Home
Poland Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home
Portugal Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
Romania Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius
Russia Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
South Korea Zara
Spain Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
Sweden Zara, Pull&Bear, Massimo Dutti, Oysho, Zara Home
Switzerland Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Zara Home, Uterqüe
United Kingdom Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterqüe
United States Zara, Massimo Dutti, Zara Home

For any press request please contact with:
Communication and Corporate Affairs Division
Edificio Inditex
Avda. de la Diputación s/n
15143 – Arteixo
A Coruña – ESPAÑA
Tlf: +34 981 185 400
Fax: +34 981 185 544
comunicacion@inditex.com