Higher raw materials price may hit Benetton profits this year
16 Mar '11
4 min read
These actions reflected initiatives launched in 2009 and continued with determination in 2010. Negative influences on the result were: foreign exchange movements against the Euro, in particular those of higher growth countries, the network support policy adopted in the last two seasons and, towards the end of 2010, also the first effects of increases in the cost of raw materials. EBIT from ordinary operations, was €208 million, equivalent to 10.1% of revenues (€229 million in 2009, 11.1% of revenues).
Non recurring expenses were €32 million, compared with €23 million in 2009, partly associated with actions relating to general expenses and cost of sales already mentioned, and partly due to write-downs in the value of fixed assets.
The excellent performance in the reduction of indebtedness, even with higher costs associated with the new loan arranged in June 2010, and the profits generated by foreign currency hedging operations, resulted in improved financial management, which showed expenses of €7 million in 2010, compared with €22 million in 2009.
The Group tax rate increased as a result of the expected reduction in benefits generated by the Group corporate reorganization in 2003.
Net income for the year was thus €102 million, compared with €122 million in 2009, equivalent to 5.0% of revenues (5.9% in 2009).
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