By Christopher Bjork

ARTEIXO, Spain--Zara parent Industria del Diseño Textil SA, better known as Inditex, gained a loyal following among fashionistas globally by pumping out versions of the latest catwalk fashions at relatively low prices. Now, the company is latching on to a new trend itself: sharing some of its profits with workers.

The world's largest fashion retailer by sales unveiled an employee-incentive plan on Wednesday, as it reported a 5.2% rise in net profit to EUR2.5 billion ($2.65 billion) in the year ended Jan. 31. Inditex's sales grew 8.3% to EUR18.12 billion in the period.

"We want to recognize the contribution of all of Inditex's workers in the development of the company," Inditex Chairman and Chief Executive Pablo Isla told reporters. He said Inditex would share 10% of its annual increase in profit with employees who have been with the company for more than two years, allowing about 70,000 workers to get a cash bonus if profit grows.

The profit-sharing plan is initially intended to run for two years and is capped at 2% of annual profits.

Inditex, whose runaway success made its now-retired founder and majority owner, Amancio Ortega, one of the richest men in the world, isn't the first European retailer to share its wealth. Sweden's Hennes & Mauritz AB, another family-controlled retail empire, this year distributed 303 million Swedish kronor ($34.5 million) to employees who have worked more than five years at the company, the equivalent of 10% of its profit growth. And at Spain's largest food retailer, Mercadona SA, owner Juan Roig has, since 2001, shared a chunk of its profits with employees, helping to reduce churn despite relatively modest salaries.

Inditex has in recent quarters been helped by a rebound in consumption in Spain, where the company derives a fifth of its revenue. The addition of 343 new stores in 54 countries, and rising online sales also propelled growth. Mr. Isla, speaking at the company's headquarters in the northwestern Spanish industrial town of Arteixo, said sales in Spain rose at a clip of 5% last year, and that similar growth rates could be expected in the year ahead.

Zara.com, Inditex's biggest online sales platform, is clocking 2.5 million visitors a day, more than double the traffic it was generating three years ago. In the coming months, Zara will begin online sales in a further three Asian markets: Taiwan, Hong Kong and Macao.

Like-for-like sales--which included online sales--grew 5% during the last fiscal year, compared with 3% in 2013.

Inditex said sales in the first weeks of the new year had continued the growth trend. Store and online sales in local currencies grew 13% between Feb. 1 and Mar. 14, compared with a growth rate of 11% in 2014.

The robust earnings led investors to bid up Inditex's shares 3.5% to close at a fresh all-time high of EUR29.15 in Madrid. At that price, the company is worth EUR90.9 billion, more than any other Spanish firm.

The company last year spent just under EUR1.4 billion on store openings and on an expansion of its headquarters and logistics centers. It also spent EUR400 million on a property in New York's SoHo district where it plans to open a new store.

This year, Inditex said it is budgeting EUR1.35 billion in capital expenditures, mainly to fund the opening of between 420 and 480 new stores and the closure of 80 to 100 smaller shops.

Inditex said it plans to pay a dividend of 52 European cents a share on 2014 results, up 7.5% from a year earlier. The company will distribute EUR1.62 billion in cash to shareholders, of which more than half will go to Mr. Ortega and his family.

Jens Hansegard in Stockholm contributed to this article.

Write to Christopher Bjork at christopher.bjork@wsj.com

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