MILAN — Call Giorgio Armani the 100 million euro man.
That is how much the designer received in dividends last year as his company's sole shareholder — a payout that resulted from Giorgio Armani SpA's strong financial performance in 2005.
The company revealed in its annual report released this week that its net profit for the year ended Dec. 31 spiked 22.7 percent to 154.8 million euros, or $193 million, boosted by 39.8 million euros, or $49.75 million, in extraordinary income from real estate and stock market deals. Dollar figures have been converted from the euro at average exchange rates for the period to which they refer.
Calling 2005 "a record-breaking year," Armani touted a series of business developments, including the birth of the couture line Giorgio Armani Privé and the formation of a joint venture to expand the A|X Armani Exchange brand worldwide. Those two moves consolidated Armani's presence on both ends of the fashion spectrum, from custom-made gowns to T-shirts.
"Through the introduction of the Giorgio Armani Privé couture label at the start of the year and the signing of a joint venture agreement for the worldwide expansion of the A|X Armani Exchange brand at the end of the year, we effectively closed the circle on our unique multibrand approach, so that we are now able to reach all levels of the marketplace with carefully differentiated lifestyle fashion collections under the Armani master brand," the designer said in the annual report's opening letter.
Operating profit and revenue figures were in line with preliminary figures released in April. Earnings before interest and taxes rose 17.6 percent to 191.4 million euros, or $239.3 million. Sales advanced 10 percent to 1.43 billion euros, or $1.79 billion.
Two financial operations boosted Armani's bottom line significantly. Last year, Giorgio Armani sold 49 percent of ManzoniUno Srl, the company that owns Armani's flagship on Milan's Via Manzoni, to another firm controlled by the designer. That deal generated a gain of 18.4 million euros, or $23 million, for the Giorgio Armani group's coffers. Armani sold off 51 percent of ManzoniUno in 2004, similarly to another firm controlled by him.
Giorgio Armani SpA also booked a 21.1 million euro ($26.4 million) gain off its 1.5 percent stake in eyewear company Safilo SpA, which relisted on the Milan Stock Exchange last year. Armani received the shares as part of an agreement with Safilo, which produces Giorgio Armani and Emporio Armani eyewear.
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