Zara achieved a 10% uplift in UK sales in the year to 31 January 2019 and the Inditex-owned brand said it would continue to open more stores in this market “as soon as suitable opportunities arise”.
In accounts filed at Companies House, the UK arm of the Spanish giant, recorded sales of £772.5 million, compared to £704.8m year before. However its cost of sales in this market outpaced its sales growth leading to profits being more than halved at £22.3m at pre-tax level, compared to £53.2m in the prior year.
Selling and distribution costs grew by 7% reflecting the investment it made in integrating its online and retail operations and in upgrading a flagship store in Westfield Stratford and relocating its Brighton, Oxford and Leicester stores. One store, in London’s Whiteley’s, was “absorbed” during the period meaning it operated 63 UK stores.
While the company said it was experiencing “difficult and unpredictable” trading conditions in the UK, it did not expect Brexit to make a significant impact on it business here.
“Since the company’s merchandise is exclusively purchased from the group and all of our customers are based in the UK, we do not consider that Brexit will have a significant impact on the business, so we deem the economic risk to be low,” its statement read.