MILAN, Feb 17 (Reuters) - Italian clothing retailer Benetton (BNG.MI) reported a 7 percent rise in 2008 net profit on Tuesday and said it would implement "radical actions" to prepare for the tough climate ahead.

Benetton spring-summer 2009

The company, known for its brightly coloured sweaters, said in a statement on preliminary results it had met its objectives, with 2008 net profit at 155 million euros ($196 million). Revenues rose 4 percent to 2.128 billion euros, or 5.7 percent excluding currency effects.

"The situation in 2009 will be difficult for everyone, and this was made quite clear by trends in the fourth quarter of the year just ended," Chief Executive Gerolamo Caccia Dominioni said in the statement.

"We will initiate a series of radical actions to prepare the company for the (emerging) context, which will, inevitably, increase pressure on profitability."

Benetton said it would pursue four key policies; strengthening collaboration with sales partners; optimising its industrial and production system; reducing structural costs; and continuing to invest "with discipline".

Fellow fashion retailer Hennes & Mauritz AB (HMb.ST) on Monday posted a smaller-than-expected 1 percent year-on-year fall in January sales at established stores. Benetton shares were down 3.97 percent at 5.57 euros at 1309 GMT, while Milan's Mibtel index was down 1.9 percent. ($1=.7908 Euro) (Editing by Will Waterman)