El Corte Inglés expansion plans
Spanish retailer, El Corte Inglés, plans to expand its business into Portugal and Italy in a bid to salvage its disappointing results at home. Suffering from increasing competition from specialist boutiques and supercentres, the privately held group however remains committed to its department store format. At the annual shareholders meeting last weekend, chairman Isidoro Alvarez said that the group was expanding in Portugal and was wrapping up negotiations to open its first store in Rome .
It is the first time that the Spanish group’s earnings have fallen below those of Inditex, the Spanish owner of Zara. Inditex saw earnings of €628 million (£351.8 million) on sales of €5.7 billion, while El Corte Inglés revenues rose 7 percent to €14.6 billion, with net profits rising only 6 percent to €610 million.
Alvarez contended that, despite the troubles, the format of the store remained “the motor of growth of our groupâ€. The group operates a supermarket chain, Hipercor, a low-cost fashion chain, Sfera, as well as travel agencies, an insurance company, a consumer finance group, an optician, drugstores, telephone and utility services.
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