Italian fashion retailer, United Colours of Benetton have announced a fall in profits for 2010, and explained that an increase in material costs will hit profits for the coming year as well.
The company’s net profit for the year was £89million, down £15million on last year, although revenue sat the same at 2.1billion Euros.
European revenue dropped by 2.8% but growth in other regions made up for the shortfall.
The company announced that raw materials had increased in price in the final quarter of 2010, and those costs would affect next year’s figures as well.
“The strong growth in costs, especially of raw materials, will lead to a significant and progressive erosion of margins during the year,” said Benetton.
The group were also pleased to announce that net debt had fallen from 556million Euros to 486million Euros in the past year.