Zara stays strong in Australia despite profits slowdown
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While some chains struggle in the Australian market, Inditex’s Zara is committed to the country and is seeing its operations growing although profit has fallen, according to local press reports.
On Wednesday, the same day that rival Topshop’s local franchisee announced a voluntary administration filing, The Age reported that the Spanish chain by contrast has enjoyed another year of double-digit growth in the country.
It saw A$256.36m in sales in the year to January 31 2017, boosted by the opening of three new stores in the Sydney suburb of Parramatta, the Gold Coast and Brisbane. That figure was up 15.5% year-on-year, although this was slower than the 24% rise seen in the previous year. And its profit was slower too with the company making A$10.3m compared to $15.26m in the prior year.
Like Topshop, Zara arrived in Australia in 2011 and had 18 stores by the end of January this year. It had 1,700 employees, several hundred more than it had working for it in Australia a year earlier.
The local operation is 90% owned by Inditex and 10% by Peter Lew through his International Brand Management unit. Lew is the son of retail entrepreneur Solomon Lew.
Questions & Answers
Q.What were Zara's total sales in Australia for the most recent financial year reported?
What were Zara's total sales in Australia for the most recent financial year reported?
Zara's sales in Australia reached A$256.36 million in the year ending January 31, 2017. This figure represents a 15.5% increase compared to the previous year, showing continued growth in the market.
Q.How did Zara's profit performance in Australia compare to the previous year?
How did Zara's profit performance in Australia compare to the previous year?
Zara's profit in Australia was A$10.3 million for the year to January 31, 2017. This indicates a slowdown in profit, as it was lower than the A$15.26 million reported in the prior year.
Q.How many new stores did Zara open in Australia during the period covered by this report?
How many new stores did Zara open in Australia during the period covered by this report?
Zara opened three new stores in Australia during the reported period. These new locations were in the Sydney suburb of Parramatta, the Gold Coast, and Brisbane, contributing to their sales boost.
Q.Who owns Zara's Australian operations?
Who owns Zara's Australian operations?
Zara's Australian operation is primarily owned by Inditex, which holds a 90% stake. The remaining 10% is owned by Peter Lew through his International Brand Management unit.
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