Inditex simplifies structure by merging local subsidiaries in Portugal, Italy, the UK
Spanish group Inditex continues to streamline its corporate structure, and has amalgamated its subsidiaries in three key markets: Portugal, Italy and the United Kingdom. In these countries, the group has reduced the number of companies it operates with, from 22 to just three.
Inditex has followed the same process in all three markets, as reported by Spanish business daily Cinco Días. The group has liquidated the subsidiaries through which each of its brands was operating, except for the Zara operating companies, which have been renamed ITX Portugal, ITX Italy and ITK UK.
From now on, while there is no change in the way Inditex and its brands do business, what will change is how the various brands’ revenue is recorded, since they will all be incorporated in the same financial statement, one per country.
With this move, Inditex is seeking to simplify its operations, deploying in these key markets a system that it began to introduce in 2020. Again as reported by Cinco Días, in 2020 the group liquidated 27 subsidiaries (mainly in Croatia, Denmark and Bosnia, as well as Spain, where it closed down a number of logistics companies that had done no business in recent years) and dismantled the previous structure, featuring 350 separate companies.
Italy, Portugal and the UK are crucial for the Galician group's performance in Europe. At the end of H1 of the current financial year, Inditex operated 771 stores altogether in these countries: 347 in Italy, 320 in Portugal and 104 in the UK. Inditex had nine subsidiaries in Portugal (its sixth-largest market), seven in Italy and six in the UK, where the corporate consolidation process has just begun.
The Spanish textile giant closed H1 on July 31 on an upward trend: it cancelled the losses for €195 million recorded in the previous year, posting a €1.272 billion profit with a revenue of €11.936 billion, 49% higher than in the same period in pandemic-stricken 2020.
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