Italian fashion group Benetton presented a bullish outlook for the year as it posted profit and revenue gains for the first half. Net profits for the six months ended 30 June rose 1.9 percent to €64 million, while sales gained 6.7 percent to €898 million. Chairman Luciano Benetton said in a statement that the company’s development “in all major markets” and its accelerated growth in orders “confirm the strength of our world-wide commercial network and the appreciation of the quality of our products by the final consumer.” He added that he had “the firm conviction that this tendency is only the beginning” and that he expected further growth in the future. The company raised its previous full-year growth prognoses from 3.6 percent to 8 percent. Full year net profits are expected to reach 6.5 percent of revenues, amounting to €123.9 million.
Apparel wholesale sales climbed 7.4 percent to €825 million. Apparel sales increased thanks partly to a higher contribution from its partnership with the Turkish Boyner Group established in 2005 – a contribution of €14 million – and from sales growth of directly owned stores. The Mediterranean region, Eastern Europe , China and India showed significant growth. Meanwhile, first half profits grew mainly due to lower tax rates. Pre-tax profits dipped 1.4 percent to €83 million, while the company’s decreased margins were the result of an incentive scheme aimed at franchisees, a spokesperson told WWD. The company started selling products at lower wholesale prices so that its franchisees could benefit from higher profit margins in their stores.