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Benetton reports on Q1 2003

In mid May the Benetton group reported the results for the first quarter of 2003. Revenues for the casual sector for the firs three months of 2003, net of currency impact, are up by 3.8 per cent to 351 million euro. Growth in the clothing division, in terms of revenues and volumes, was offset in particular by the expected reduction in turnover in the sports equipment brands, agreements for the sale of which were signed during the early months of the year.

Overall revenues for the period were therefore 444 million euro against 447 million recorded in the first quarter of 2002. Net income increased by 29 per cent, to 25 million euro, benefiting from the decisive reduction of fixed costs and the decision to sell the sports equipment division.

Gross operating income, net of currency impact and the sports equipment division, was 178 million euro, with a growth of 1.1 per cent compared to the first quarter 2002, with a ratio to turnover of 45.5 per cent. Overall gross operating income was 192 million euro for the period. Income from operations for the casual sector, net of currency impact, was 52 million euro (14.8 per cent of revenues), up 4.0 per cent against the first quarter 2002, due in particular to efficiency improvements achieved in the distribution network and reductions in labour costs. Total income from operations was 54 million euro.

Despite the continuing crisis of the world economy in the international markets, and the resulting decline in consumer spending, the group’s performance is in line with the previous year and with its forecasts. With the conclusion of the process of internal reorganisation and rationalisation in the early part of the year and the sale of its businesses in the sports equipment sector, the group’s resources will be exclusively dedicated to its core business of casual and sportswear.

Given this situation an the information currently available, the group expects to meet its 2003 forecasts in terms of sales and margins. At the same meeting the Benetton group board of directors granted the powers of managing director to Silvano Cassano.

Source: Benetton