MILAN, March 18 (Reuters) - Italian clothing retailer Benetton Group SpA (BNG.MI) said its chief executive would leave after nearly three years at the helm and said it would distribute a lower dividend as it confirmed a drop in yearly net profit.

United Colors of Benetton

Benetton said CEO Gerolamo Caccia Dominioni would leave at the end of his term at the April 22 shareholders' meeting. He was appointed in 2007 after his predecessor quit over a disagreement with the Benetton family's expansion plans.

The clothes maker is proposing to appoint Franco Furno and Biagio Chiarolanza to the board, delegating operating management of the company.

Furno will head the commercial, product and human resources divisions. Chiarolanza will be responsible for administration, finance and control, operations and foreign business units.

Benetton said 2009 net profit was 122 million euros ($166.6 million), confirming a preliminary estimate it gave in January of more than 120 million euros.

Benetton had a net profit of 155 million euros in 2008.

"Revenues for the first quarter of 2010 are expected to be in line with the same period of 2009," Benetton said.

Once famed for its colourful sweaters, Benetton also said it would propose a dividend of 0.23 euro per share versus a dividend of 0.28 euro per share the previous year.

At 1224 GMT, shares rose 1.1 percent to 6.055 euros. (Editing by David Holmes)