Watches of Switzerland Group ‘cautiously optimistic’ despite drop in full year profit
Watches of Switzerland Group has said it is cautiously optimistic about the year ahead despite reporting a 40% decline in annual pre-tax profit to £92 million.
In the year to 28 April, group revenue edged down 2% year-on-year on a constant currency basis to £1.5 billion, although luxury watches sales, which account for 87% of group revenue, rose by 3% due to a particularly strong performance in the US.
Meanwhile, jewellery revenue fell by 13% at constant currency but there was an sequential improvement in the category throughout the year with the best performance coming in the fourth quarter.
Looking at the group’s geographical markets, UK and Europe revenue declined by 5% at constant currency to £846 million as the UK continued to be impacted by difficult trading conditions. However, the US performed much better with a 11% increase in revenue to £692 million.
Watches of Switzerland Group chief executive Brian Duffy said: “I am proud of the performance that our team delivered this year in what was undoubtedly a more challenging market.
“We cemented our position as a leading international luxury watch and jewellery retailer and delivered further market share gains in both the UK and US, driven by our proven, differentiated business model.
“In particular, our US business went from strength to strength, growing 11% and will soon represent half of group sales.
“The UK market is starting to show signs of stabilisation. In FY24, UK and Europe sales were down 5% impacted by significant price increases overall at a time of reduced consumer confidence influencing discretionary spending, and we see these pressures easing in FY25.”
The group has held its guidance for the current financial year and said it is “cautiously optimistic”.
Duffy added: “Our strategic momentum underpins our confidence in our FY25 guidance and Long Range Plan objectives of doubling sales and profit by 2028, capitalising on our leading market positions and the unique growth opportunities ahead.”
