Lower six-month results for Swatch Group
The Group generated net sales of CHF 4,078 million, -3.7% at constant exchange rates compared to a very strong previous year, and -4.4% at current rates. Operating result decreased by -13.0% to CHF 547 million compared to the previous year. Operating margin was 13.4% (previous year: 14.7%). Net income totaled CHF 415 million (-11.3% compared to the previous year) or 10.2% of net sales (previous year: 11.0%). The Swatch Group anticipates strong growth in the second half of 2019, on the one hand, due to continuing solid demand in the most important markets, and on the other hand, due to the fact that the second half of 2018 was characterized by a poor fourth quarter. The launch of numerous innovative new products by the brands in all price segments will further stimulate sales. The successfully implemented e-commerce, especially in the middle and basic segment, will generate dynamic growth in the second half of the year. The Group expects positive sales growth for the entire year in comparison to the previous year.
Watches of Switzerland without Rolex and Patek Philippe
Watches of Switzerland has opened a fourth multibrand store in the United States, this time at Encore Boston Harbor, part of a Wynn Resorts luxury resort and casino. It is the second Wynn Resorts collaboration for Watches of Switzerland, having opened at Wynn Las Vegas in December 2018. The company also has two stores in Manhattan, New York City. The Boston opening is the first time that Watches of Switzerland has entered a new market without the pulling power of Rolex or Patek Philippe on its roster of brands. It has dedicated areas for Hublot and Panerai and adjacent standalone boutiques for Omega and IWC. There will also be watches from Franck Muller, Ressence, Bovet, Laurent Ferrier and Jacob & Co. Working with Ressence, Bovet, Laurent Ferrier is described as part of a strategy to work with smaller, independent brands, the company says.
The GPHG 2019 inaugurates new categories
The Grand Prix d’Horlogerie de Genève (GPHG) is perpetually shifting, evolving and adapting. For its 19th edition, the GPHG is inviting watch brands to enter watches in 14 different categories, including two unprecedented ones. As its name implies, the Diver’s category is dedicated to watches linked to the world of diving, whose functions, materials and designs are suited to this activity. The Iconic category is open to watches from an emblematic collection that has been exercising a lasting influence on watchmaking history for more than 25 years. In addition, the Calendar and Astronomy category is back this year and relates to men’s mechanical watches comprising at least one calendar and/or astronomical complication. The “Horological Revelation” Prize is also returning in 2019, enabling the jury to reward a creation from a youthful brand. The 2019 list of prize-winners will be announced on Thursday November 7th at the Théâtre du Léman in Geneva.
Sharp monthly rise of Swiss watch exports en May 2019
Exports in the sector rose steadily in May (+11.4%) to more than 2 billion francs. The increase was driven by an additional business day, and by an exceptional export of alarm clocks and small clocks. Underlying growth in the sector was between +8 and +9%, as evidenced by the increase in watch exports. Performance remained sharply polarised in terms of price segments. Watches priced below 200 francs (export price) continued to lose ground, falling by 16.1% by the number of items. At the other extreme, timepieces priced over 3,000 francs recorded double-digit growth. The vast majority of markets saw an increase during May. Hong Kong (-7.0%) was a major exception, recording a decline for the second consecutive month and confirming the downward trend seen since the start of the year. China (+81.0%) was boosted by the exceptional export of alarm clocks and small clocks, but would have recorded very strong growth even without it. Among the other Asian markets, Japan (+39.8%), Singapore (+24.9%) and the United Arab Emirates (+44.6%) all saw significant gains. The United States (+10.4%) was close to the global average, as was France (+10.9%).
LVMH Watch Division exhibition in Dubai in January 2020
Stéphane Bianchi, President of the LVMH Watch Division, and Jean-Christophe Babin, President of the Bulgari Group, are announcing the first LVMH Swiss Watch Manufactures Exhibition. The event will take place in Dubai Bulgari Hotel in January 2020 and will include Bulgari, TAG Heuer, Hublot and Zenith. The four Watch Brands will introduce to the International Medias and Retail Partners their Watchmaking news 2020. “In between Geneva in January and Basel in March, we have had in the recent years two major product presentations in the first quarter. This early discovery of our strategies, news and novelties has allowed our media and retail partners to better plan the year ahead and as such we have decided on this set up for 2020 to balance the scheduling of the other events”, declared Jean-Christophe Babin. As previously announced, Bulgari, TAG Heuer, Hublot and Zenith are also confirming in parallel their presence at Baselworld 2020, late April/early May.
Richemont annual sales growth of 27%
Group sales increased by 27% at actual and constant exchange rates to €13,989 million. Since 1 May and 1 June 2018, respectively, Yoox Net-à-Porter (YNAP) and Watchfinder & Co are consolidated in the Group’s accounts as Online Distributors. Excluding YNAP and Watchfinder, sales rose by 8% at actual and constant exchange rates. Richemont observed growth in all business areas and most regions with a double digit progression in Asia Pacific and the Americas and a double digit increases in the directly operated boutiques of Jewellery Maisons and Specialist Watchmakers. Operating profit grew by 5% to €1,943 million; excluding the impact of Online Distributors and one-time net charges of €118 million, the operating margin increased to 19.5%. Profit for the year rose to €2,787 million including a post-tax non-cash gain of €1,378 million on the revaluation of YNAP shares held prior to tender offer. At the end of fiscal year, the net cash position amounted to €2,528 million.
Watches of Switzerland now listed on the London Stock Exchange
Watches of Switzerland has made its IPO on the London Stock Exchange with shares climbing over 15% within hours. The listing means that 40% of the business is now owned by the public, with the group valued at around £650m. Brian Duffy said it was the perfect time for the specialist retailer to float and that the American market presented the best potential to grow as it’s a bigger market than the UK and since WoS started there with a smaller share. He said Watches of Switzerland have hands full with projects in the US already, having recently acquired 15 stores in Florida under the Mayors brand name and two stores in Las Vegas, which will open under the Watches of Switzerland fascia. Duffy also said the retailer would be opening new stores in the next few months, including two in New York, one in Boston and one in New Jersey.
A new Audemars Piguet service center in Besançon
At the end of May 2019, Audemars Piguet inaugurated its new European service center for the maintenance of the brand’s high-end watches at the Témis technopole in Besançon. This center, which is located in this 900 m² building with high energy and environmental performance, sees around 2,000 watches a year. It employs 34 people and is expected to recruit 15 more watchmakers in the next few years. “The brand is growing. In 2011, we realized a turnover of 500 million Swiss francs, last year we exceeded one billion. We sell 40,000 watches a year in the world. If we sell more watches, we repair more. And we decided more than five years ago to have two centers for Europe, Besançon and Madrid “, said the CEO François-Henry Bennahmias.
Value of Swiss watchmaking exports remains high in April 2019
Despite the most negative base effect of the year, the value of watch exports remained high, at almost 1.8 billion francs, down 0.4% compared with April 2018. Four months into the year, the situation continues to be better than expected, with a total increase in value of 2.1%. All segments below 3,000 francs (export price) saw steep declines. The reduction in the number of timepieces priced below 200 francs was -23.6%. Watches priced over 3,000 francs remained positive, helping to stabilise the trend in export turnover. Results for April varied across different markets. The negative change in exports to Hong Kong (-3.9%) accentuated the slowdown in growth that began in late 2018. The trend in the United States (+16.8%) was in the opposite direction and confirmed the strength of the situation there, in spite of a negative base effect. Japan (+21.2%) posted its fourth consecutive month of strong growth, while China (-5.5%) lost ground.