Inditex Group, the fashion empire controlled by billionaire Amancio Ortega famous for the Zara clothing brand, announced 15 December a big profit rise.
Inditex recorded €1.18 billion in net income for the period up to 31 October, a 42% year-on-year rise for the fist nine months of 2010. Store openings in Asia were a highlight for the group, which has opened eight new stores in Japan, eight in South Korea and 42 in China. The world's largest retailer by sales also announced a 14% increase in revenues to €8.9 billion.
The group did continue expanding in Europe, but at a slower pace than in Asia and reported a 10% increase for store sales in local currencies between 1 August and 12 December.
Earlier in the year the Spanish retailer noted the strategic importance of expansion in Asia to its overall strategy.
Despite the positive results, Inditex's share price dropped 5.5% yesterday as news emerged that ratings agency Moody's was considering downgrading Spain's credit rating. Inditex shares have increased steadily throughout the year as it consistently reported strong results.
Inditex was founded by Ortega – who still serves as chairman and owns 60% of the business – in 1975 when he opened his flagship Zara store in Spain. The brand is now the cornerstone of the empire, which has 5,000 stores in 77 countries.
Ortega was ranked the 9th richest man in the world by Forbes in March 2010, with an estimated personal fortune of $25 billion. His daughter Marta also works in the business and speculation is rife she will succeed her 74-year-old father when he steps down as company head, but no succession plan has been made public.
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