Spanish textile titan Inditex, owner of global fashion brand Zara, reported Wednesday slower profit growth in 2013 as it poured money into new stores, with up to 500 more to open this year.
Created 40 years ago in the north-western Galicia region by the son of a railwayman, Amancio Ortega, the group boasted a world-wide empire of 6,340 stores in 87 markets at the end of its 2013 business year, which runs to January 31.
Though Ortega, Spain's richest man and still Inditex's biggest shareholder, retired as chairman and chief executive in 2011, handing over to Pablo Isla, the group's philosophy of expanding with new stores and online sales has not wavered.
In 2013, Inditex's sales rose by 4.9 percent from the previous year to 16.72 billion euros ($23 billion), the group said in a statement.
But despite stressing "strict control of operating expenses", Inditex said business costs rose as it coped with a net 331 new store openings and higher sales in the year.
Net profits edged up by 0.6 percent from the previous year to 2.38 billion euros in 2013, it said.
That result represented a marked slowdown from the previous year, when sales soared 16 percent and net profit by 22 percent.
"The 2013 results are satisfying, in a year characterised by strong investment and job creation," Isla told a news conference at the company's logistics centre in the town of Meco near Madrid.
Inditex created over 2,000 direct and indirect jobs in Spain last year, he added, welcome news in a country grappling with a jobless rate of just over 26 percent, the second-highest rate in the EU after Greece.
The new business year began with a sales spurt, however, Inditex added, with sales in local currency terms for the February 1-to-March 15 period rising 12 percent from a year earlier.
Investors welcomed the news, pushing Inditex shares 4.61 percent higher to 107.85 euros by mid-afternoon on the Madrid stock exchange.