Inditex profits rose in Mexico, Turkey and China, but fell in the United States

The strong growth in Inditex's profits in 2023, with a net result of 5,381 million euros, an increase of 30.3%, has names and titles. The textiles group recorded two out of every three euros of its pre-tax profits In only six markets – Spain, the Netherlands, Mexico, Switzerland, the United States and Turkey – as stated in their annual financial report filed with the National Securities Market Authority (CNMV).

Spain is the main market for the owner of Zara Both in terms of sales and in terms of results, it is the country with the largest number of stores (1,157) and what Arteixo calls the headquarters effect.

Inditex sales increased by 13% in the national market in 2023, reaching 5.666 million. Growth exceeding the group average allowed Spain to win For the first time in more than a decade, weight on the company's total sales. It now represents 14.8% of the total, four-tenths more.

Weighing on the result is greater. Profits before taxes in the national market amounted to 1,618 million euros, an increase of 13.7%, equivalent to 25.6% of the company globally (6,316 million) before the merger adjustments were made (it was 6,870 million after the aforementioned adjustments).

Inditex paid $334 million in Spain for corporate tax From last year. If other fees are added, the total taxes paid amount to 1,048 million euros. The figure doubles to 2,231 million if you also take into account the taxes collected by the textile group.

Mexico enters the top three

Holland It was consolidated in fiscal year 2023 as The second country where Inditex earns the most moneyWith a profit before taxes of 824 million, an increase of 40.6%. The importance of this country in the results is due to the dozens of companies that the company owns in this market and the activity of its distribution center in Lelystad.

It is the only company the company has outside of Spain and Zara mainly serves the European market. In addition, Lelystad is part of the company's $1.8 billion logistics support plan announced for the next two years, which will add an additional 125,000 square metres.

Mexico completed the top three In terms of corporate profits last year, it rose two places on the list and overtook Switzerland and the United States in the same ranking. The Mexican market contributed €541 million to the textile giant's pre-tax profits, 40.6% more, and was by far the US country in which the company achieved its best results.

One of the keys to this development is that, in the general context of institutional closures, Inditex has strengthened its business presence in Mexico Last year, the number of points of sale increased from 383 to 399 points of sale. Within two years, the group opened 17 stores in the country, while closing 785 stores globally.

USA surprises

SwissInditex owns several companies that manage the company's international trade – especially its purchases of products in Asia -, Contributed 525 million to profit Before tax for the group last year, up 6.5%, while the United States was the only country in the top ten countries in terms of profits to reduce its results, from 424 to 393 million euros, i.e. 7.3% lower.

Fashion did not record a particularly prosperous year in 2023 United States of AmericaAs many textile groups noted in their accounts. Inditex does not provide data on the development of its business or the reasons for the decline in its profits in the country, which makes it impossible to analyze the reasons.

What seems clear is that Its commitment to the United States is unwavering. The group has announced 30 new projects – openings, renovations and relocations – in this market between 2023 and 2025. This year, flagship companies will open in Los Angeles, Las Vegas and the Boston area. In addition, Zara will take Pre-Owned – its second-hand platform – to the United States and launch its sales through live streaming in the country, where its online influence is high.

The opposite is the case for the United States, at least at the benefits level Türkiye. Inditex earned $374 million in this country last year, nearly triple what it earned the previous year (+173%), partly due to the currency effect.

Other markets where pre-tax profits doubled were ChinaWith 241 million euros (+129%) and GermanyBy 130 million (+103%). In case Poland, the result is multiplied by seven (from 9 to 68 million), although its weight on the total group is much lower. But the development in the three countries is striking, as it was achieved despite the company reducing the number of stores it has in all of these countries.