By  on April 13, 2006

MILAN — Giorgio Armani SpA on Wednesday reported double-digit growth in 2005 profits and revenue as it opened dozens of stores and further diversified into areas such as accessories and home furnishings.

The company also said first-quarter retail sales were up 8 percent.

Earnings before interest and taxes for the 12 months ended Dec. 31 surged 18 percent to 191 million euros, or $238.8 million. Sales for the period advanced 10 percent to 1.42 billion euros, or $1.8 billion, which Armani termed a "record level."

All dollar figures have been converted from average exchange rates for the period to which they apply.

The numbers show a significant improvement from 2004, when sales advanced 3.5 percent and advertising costs bit into profits. Armani will release net profit figures in May, when it publishes its annual report.

President and chief executive officer Giorgio Armani, who is 71 years old, referred in a statement to speculation surrounding the business and his succession plans.

"As the sole shareholder of an independent company, I am often asked about plans for the future," Armani said. "The performance of this company speaks for itself."

Stating that his brand is worth 5 billion euros, or $6.1 billion, at retail, Armani said he is among the world's most powerful brand names. In addition, he said there are significant internal resources at the company to fund organic growth and praised his management team as one of the best in the industry

"We can look forward to the future with great optimism and confidence," he concluded.

Armani has said at various points he doesn't want to sell his company and answer to a new owner. In an interview with The Wall Street Journal published Monday, he denied that the firm was preparing for an initial public offering. However, Armani didn't completely dismiss the idea, and has alluded to the possibility on occasion, suggesting that he has gradually warmed to the concept of the stock market over the last few years.

"The most suitable solution is perhaps the stock market....I need to give a signal to the market ... I have to think of the future of the company," he told the newspaper. "I also have to give signals to the people who work here."

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