MILAN (Reuters) – Italian luxury goods group Armani posted a 20% increase in sales at constant currencies in the first half, after swinging to an operating profit in 2021 as revenues returned above pre-pandemic levels in the second part of the year.

Revenues “now constantly exceed the levels achieved in 2019, thus setting the stage for a substantial improvement in operating profitability — subject to certain potential risks,” the group said in a note citing a possible economic recession caused by the Ukraine war, new COVID-19 waves and restrictive monetary policies to fight inflation.

Armani said consolidated net revenue last year totalled 2.02 billion euros ($2.1 billion), up 26.3% from 2020. Sales at directly-operated shops, which account for more than half the total, grew by 37% over 2020.

The Milan-based group posted earnings before interest and tax (EBIT) of 171.2 million euros, versus an operating loss of 29.5 million euros in 2020.

The remarkable growth achieved in 2021, consolidated by the positive performance in the first half of this year, makes me cautiously optimistic,” said Giorgio Armani, chairman and CEO of the group.

($1 = 0.9775 euros)

(Reporting by Valentina Za, Editing by Louise Heavens)