MILAN — Benetton reported Wednesday that net profits rose 8.6 percent to 29 million euros, or $40.3 million, on a 3.4 percent hike in sales in the first quarter.
This story first appeared in the May 15, 2008 issue of WWD. Subscribe Today.
Sales reached 465 million euros, or $646.3 million, in line with the full-year forecast. Currency conversions were made at average exchange rate for the period referred to.
The company said sales were influenced by new delivery schedules for the spring and summer collections, the conversion of wholesale operations to retail in the U.S. affecting a number of stores and the strength of the euro.
Gross operating profits grew 11.5 percent to 214 million euros, or $297.4 million, compared with the first quarter in 2007, which the company attributed to “greater efficiency in management of the supply chain and sourcing activities.”
The Italian clothing manufacturer reported net operating capital expenditure of 74 million euros, or $102.8 million, compared with 37 million euros, or $51.4 million, in the same period in 2007, mainly resulting from purchasing and renovating stores in established markets such as Italy, France and the U.S. and in new markets such as India, Russia and Turkey.
The latter three, together with other countries of the former Soviet Union, Central and South America and China were described as “priority markets” for the group, and performed in the quarter in line with Benetton’s three-year target to double sales there. In the quarter, the company opened new offices in Moscow and new headquarters in Miami.
Benetton confirmed its sales growth of between 6 and 8 percent forecast for 2008.