Benetton Group has more than halved its debt in 2013, despite sales dropping 10% on the previous year.
The Italian retailer, which owns Sisley as well as the Benetton fascia, recorded sales of €1.6bn (£1.32bn) for the financial year. In a statement, the company said the decline was “to be expected” after it had exited “a significant number of markets that are no longer strategic”.
But despite this, and investment in the business totalling €80m (£66m), the company has managed to halve its debt, primarily by selling off a number of its properties.
As a result, over the next three years Benetton Group plans to invest nearly €100m (£82m) a year.
Recent performance has improved, with same store sales “taken from a sample of the group’s most significant retail locations around the world” up 17.7%in the last quarter of 2013 and the first quarter of 2014. Margins are up a similar level, according to the company.
These improvements are principally due to an increase in traffic levels in stores and an improved conversion rate.
Chairman Alessandro Benetton said: “For our group, 2013 was a year of changes, part of an important transition process.
“The key principles of the strategy put in place by Benetton Group are: a renewed business model centred on the end consumer, and thus focused on the ‘sell-out’ end of the business; a focus exclusively on the main brands and on the markets with the biggest opportunities for their business; a retail approach applied both to directly-managed stores and to the network run by commercial partners.”
Benetton first revealed it was embarking on a three year restructuring programme in November last year. A month later it revealed plans to close its loss-making fascias Killer Loop and Jeans West.