Luxury brand Jil Sander AG, which is owned by the Prada fashion house, has posted a net loss of €34.6 million for 2004, affected by unfavorable exchange rates, store operating costs and product development expenses.

Full-year sales rose 10 per cent to €137.5m compared to €124.9m in 2003, mainly a result of expansion in outlets in Eastern Europe.

Jil Sander chief executive officer Gian Giacomo Ferraris said the company was taking the necessary action bring the brand back into profit.

The business plans to launch an  'aggressive restructuring plan' with the aim of pushing up efficiency throughout the company and lessening loss for this financial year.