Fast-fashion chain Zara plans to open more stores and increase profitability in the UK after sales rose almost 18% for the year to January 31 2008.
Zara UK, a subsidiary of Spanish fashion group Inditex, said UK trading this year had been a “rollercoaster ride”, hit by low consumer confidence. However, overall like-for-like sales growth had been good.
In the company’s financial statement lodged at Companies House last week, it said: “The directors plan to open further stores as soon as opportunities arise and for the company to increase profitability as a result of continuing increase in sales.”
Zara UK will have opened eight stores by the end of the year, one more than last year, bringing its total to 64 stores.
For the year to January 31, sales reached £238 million, up from £202.2m in 2006. Pre-tax profit increased to £4.5m, compared with £600,000 the previous year.
About 64% of the retailer’s sales increase was generated by store openings. It opened seven stores during the period.
Operating expenses grew by 15%, in line with store openings. Rent increases and revamps of two London stores pushed business expenses up by 4.4%.
Zara said: “Although the British Retail Consortium reported an overall growth in like-for-like UK retail sales for the year, this was achieved partly due to discounting and promotion. But the company delivered good sales growth.”