Italian apparel company Benetton has said it intends to offset "instability" in its main European markets by expanding in India. The plans were revealed as the firm reported an 11 per cent rise in first quarter profit to 20 million euros (25.4 million dollars), up from 18 million euros in the same period last year.
It said revenues were up 1.8 per cent to 457 million euros helped by higher sales in its own stores and favourable exchange rates. Drilling down though, a 19 per cent (currency neutral) rise in sales in emerging markets like China, Russia and Mexico, and a better performance in continental Europe more than offset a drop of 1.5 per cent in Spain and Greece.
But Benetton said it remains concerned by "signs of instability...in the markets of greatest relevance to the group, particularly in Europe." In India, where it already has a presence in all the major cities, the company now aims to open new stores also in second and third tier cities.
Efficiencies in production and the supply chain helped lift gross operating profit for the quarter by 5.4 per cent to 216 million euros or 47.1 per cent of revenues, up from 205 million euros or 45.5 per cent in the comparative period.
While savings through a group-wide reorganisation boosted operating profit to 35 million euros or 7.7 per cent of revenues, up from 25 million euros or 5.5 per cent of revenues a year ago.
Benetton said its spring/summer orders are slightly down on last year but in line with expectations with best sellers including its children's line.
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