MILAN — New stores and markets helped The Armani Group post a 2.3 percent sales increase last year, and the firm indicated that it expects earnings for the year to grow at least as much.
Bolstered by the addition of 30 stores, the introduction of new products and the entry into new markets such as China, Armani saw consolidated sales expand to $1.37 billion from $1.34 billion in 2001. However, the figures reflected a difficult second half as sales growth for the first six months of 2002 came in at 5 percent.
The group said earnings for the year should exceed revenue growth. Dollar figures have been converted from the euro at the current exchange rate.
Giorgio Armani, president and chief executive, attributed sales and profit growth to "judicious management and wise cost control against a challenging economic and political backdrop."
"Even against the current backdrop of general economic and political uncertainty, I remain optimistic that 2003 will prove to be another year of increasing revenues and profitability," the designer said.
Robert Triefus, executive vice president of Armani’s worldwide communications, said the company has seen improving trends in its business this month after a deceleration of growth in the back half of 2002, particularly in the year’s final three months.
"We’ve seen very positive indications that business for the spring-summer collections is on the way," Triefus said.
Armani will report earnings and other information in mid-April, Triefus said.
Overall, market watchers viewed the numbers favorably.
UBS Warburg analyst Chiara Tirloni said, "The comment on earnings growth — at least in line with revenue growth — could be perceived as quite good given the store expansion, negative [foreign exchange] effect and probably negative like-for-like growth, although it is too early to say with so few details."
Armani also said it will announce its new strategy for Giorgio Armani and Emporio Armani eyewear "in the near future." As reported, Armani terminated its licensing agreement with Luxottica Group SpA, ending a 14-year partnership.
In 2002, Armani invested $84.5 million to expand and renovate its store network, develop its infrastructure and make acquisitions. Over the last three years, strategic investments have totaled $527.8 million.
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