MILAN — IT Holding SpA continued its swing back into the black, posting a net profit and double-digit sales growth in the first half of this year.
The company posted a net profit of 1.3 million euros, or $1.6 million, for the six months ended June 30. That compares with a year-earlier loss of 10.8 million euros, or $13.9 million. Sales for the period rose 15.8 percent to 367.3 million euros, or $451.8 million. The company began its return to profitability in the first quarter after three difficult, money-losing years. (Dollar figures have been converted from the euro at average exchange rates for the period to which they refer.)
IT Holding president Tonino Perna released an upbeat forecast for the rest of the year. In a statement, he said strong fall-winter orders "make us optimistic about the future."
IT Holding's first-half operating profit advanced 59.1 percent to 29.6 million euros, or $36.4 million.
The company noted that first-half sales at Gianfranco Ferré climbed 10.3 percent to 56.6 million euros, or $69.6 million, while the brand's retail sales for the period grew 52.9 percent.
IT Holding's core diffusion business, including its manufacturing licenses for the Just Cavalli, D&G, Versace Jeans Couture and C'N'C Costume National brands, saw its first-half sales advance 11.4 percent to 225.2 million euros, or $277 million.
Last year, Dolce & Gabbana severed its 12-year partnership with IT Holding for D&G, taking production of the diffusion line in-house. IT Holding's production contract for D&G ends with the fall-winter 2006–2007 season.
Since losing the lucrative D&G license, the firm has sought other revenue by inking a production deal for John Galliano's new diffusion line, called Galliano, developing its accessories business and growing in-house knitwear brand Malo.
On the accessories front, first-half sales rose 37 percent to 59.6 million euros, or $73.3 million, boosted by new store openings. IT Holding, in cooperation with franchising partners in Europe and the Middle East, is rolling out accessories-only stores, 19 of which opened in the first half.
Today there are 25 accessories boutiques branded +IT. The company plans to bring the total to 40 by the end of the year, a spokesman said.
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