PRESS RELEASE | AD HOC
Biel / Bienne, 24 January 2023
Ad hoc announcement pursuant to Art. 53 of the Listing Rules
SWATCH GROUP: Key Figures 2022
- Net sales of CHF 7 499 million, +4.6% to the previous year at constant exchange rates, or +2.5% at current rates.
- Sales growth of 25% in local currencies in all regions, with the exception of China, where Covid lockdowns resulted in sales shortfalls of over CHF 700 million.
- The MoonSwatch is a best seller, with over 1 000 000 watches sold. Ongoing high demand, including in January, in the approximately 180 stores which exclusively offer the MoonSwatch.
-
Operating profit of CHF 1 158 million (previous year: CHF 1 021 million).
Operating margin of 15.4% (previous year: 14.0%). - Net income of CHF 823 million (previous year: CHF 774 million).
Net margin of 11.0% (previous year: 10.6%). - Operating cash flow of CHF 724 million (previous year: CHF 1 298 million); lower versus previous year, mainly due to precautionary increase in safety stock.
Free cash flow1) of CHF 342 million (previous year: CHF 1 033 million). - High net liquidity2) of CHF 2 540 million (previous year: CHF 2 558 million).
- At its next meeting, the Board of Directors will decide on the dividend proposal to the Annual General Meeting.
- In view of the strong position of the Group brands in all segments worldwide and the robust numbers in January for Mainland China, the Group aims to achieve a record year in 2023.
- Cash flow from operating activities minus cash flow from investing activities (without financial assets and securities)
- Cash and cash equivalents as well as financial assets, securities and derivative financial instruments minus current financial debts and derivative financial liabilities
1
Press release 24 January 2023
KEY FIGURES 2022
Group Key Figures
(CHF million) | 2022 | 2021 | ||||
Net sales | 7 313 | |||||
7 499 | ||||||
Operating result | 1 021 | |||||
1 158 | ||||||
- In % of net sales | 15.4% | 14.0% | ||||
Net result | 774 | |||||
823 | ||||||
- In % of net sales | 11.0% | 10.6% | ||||
Equity | 11 605 | |||||
12 051 | ||||||
- As % of balance sheet total | 86.7% | 84.8% | ||||
Unaudited figures
Highlights of the financial year 2022
Change in %
at constant currency
rateseffect
4.6%-2.1%
Total
2.5%
13.4%
6.3%
3.8%
Watches & Jewelry
At constant exchange rates, Group net sales were 4.6% above the previous year. The negative currency impact was CHF 151 million or -2.1%. The Watches & Jewelry segment (including Production) reported an operating margin of 17.2% (previous year: 15.9%).
Consistent double-digit sales growth in Europe, America, the Middle East, and most of the Asian markets was severely dampened by the significant decline in sales in China. Year on year, the sales shortfall in this region amounted to more than CHF 700 million. The fourth quarter was particularly affected. First the lockdowns, and then the massive Covid wave, after the measures were lifted, led to shortfalls of over 30% in this quarter. The decline in the month of December alone was around minus 50%. January shows growth again with sales which will exceed the strong corresponding month in the previous year.
Retail business reported double-digit growth, not only for the Swatch brand, but also in particular for the Harry Winston, Breguet and Omega brands. The Group continues to invest very selectively in new retail stores. At the end of 2022, a building was acquired at a top business location on the P.C. Hooftstraat in Amsterdam.
Demand for the 11 Bioceramic MoonSwatch models also remains unbroken high nine months after their launch, and queues in front of Swatch stores are still the order of the day. Despite an additional 70 points of sale and greatly increased production, daily demand still far exceeds available product. The MoonSwatch is popular with an extremely broad spectrum of customers of all ages and origins. In the wake of the MoonSwatch hype, the entire Omega Speedmaster collection, for example, the Moonwatch models, also profited from greatly increased interest.
Production
The production sector reported significantly higher sales and improved margins than in the previous year. Difficulties in procuring certain raw materials and components hindered an even better result and led to delivery delays, despite increased safety stock. Order books at the end of 2022 were 24% above the previous year.
Electronic Systems
Products of the highly specialized companies in the segment continued to be in extraordinarily high demand. This was the case for extremely low power consumption semiconductors from EM Microelectronic-Marin, as well as high-tech products from MicroCrystal for market leaders for mobile devices and the automotive and medical industry. Sales for the segment, to which battery producer Renata and timekeeper Swiss Timing also belong, were CHF 371 million or 18.2% above the previous year. Operating profit was CHF 47 million, corresponding to a margin of 12.7% (previous year: CHF 27 million or 8.6%).
2
Press release 24 January 2023
KEY FIGURES 2022
Inventories
In view of potential energy shortages and possible delivery bottlenecks, the Group decided to massively increase safety stock where feasible. This measure will also pay off, considering higher demand in China after its zero-Covidstrategy exit. The major portion of the CHF 484 million or 7.6% higher inventories was in the categories of raw materials, work in progress, and semi-finished goods.
Research and development
Intensive research and development activities in the year under review led to 209 new patent applications (previous year: 202).
Personnel
The number of employees increased in comparison with the previous year by 617 or 2.0% to 32 061 persons.
Outlook 2023
Group Management anticipates strong sales growth in 2023 in all regions and segments. After the end of Covid measures, consumption quickly recovered, not only in China, but also in the surrounding markets of Hong Kong SAR and Macau. In addition, lifting of travel restrictions in China will revitalize sales in tourist destinations. The sales growth in January in China reinforces the Group's expectation to aim for a record year in 2023.
Tentative next publications / events:
16.03.2023 | Publication of the annual report and the sustainability report 2022 |
10.05.2023 | Press conference |
Annual General Meeting | |
28.07.2023 | Publication of 2023 half-year results |
Original: | German |
Translations: | English, French and Italian |
CONTACTS
Investors
Felix Knecht, Investor Relations Officer Phone: +41 32 343 68 11
The Swatch Group Ltd, Biel/Bienne (Switzerland) E-mail: www.swatchgroup.com/contactus
Media
Bastien Buss, Corporate Communications Phone: +41 32 343 68 11
The Swatch Group Ltd, Biel/Bienne (Switzerland) E-mail: www.swatchgroup.com/contactus
3
Press release 24 January 2023
KEY FIGURES 2022
Consolidated Income Statement
2022 | 2021 | ||
CHF million | % | CHF million | |
Net sales | 7 499 | 100.0 | 7 313 |
Other operating income | 244 | 3.2 | 281 |
Changes in inventories | 538 | 7.2 | 19 |
Material purchases | -1 847 | -24.6 | -1 524 |
Personnel expense | -2 363 | -31.5 | -2 206 |
Depreciation and impairment on property, plant and equipment | -366 | -4.9 | -396 |
Amortization and impairment on intangible assets | -41 | -0.6 | -42 |
Other operating expenses | -2 506 | -33.4 | -2 424 |
Operating result | 1 158 | 15.4 | 1 021 |
Other financial income and expense | -38 | -0.5 | 4 |
Interest expense | -3 | -0.0 | -5 |
Share of result from associates and joint ventures | -21 | -0.3 | -9 |
Ordinary result | 1 096 | 14.6 | 1 011 |
Non-operating result | 0 | 0.0 | 0 |
Result before income taxes | 1 096 | 14.6 | 1 011 |
Income taxes | -273 | -3.6 | -237 |
Net result | 823 | 11.0 | 774 |
Attributable to shareholders of The Swatch Group Ltd | 807 | 765 | ||||||
Attributable to non-controlling interests | 16 | 9 | ||||||
Earnings per share in CHF | ||||||||
Registered shares | ||||||||
Basic earnings per share | 3.11 | 2.96 | ||||||
Diluted earnings per share | 3.11 | 2.95 | ||||||
Bearer shares | ||||||||
Basic earnings per share | 15.57 | 14.78 | ||||||
Diluted earnings per share | 15.56 | 14.77 | ||||||
Unaudited figures
%
100.0
3.8
0.3
-20.8
-30.2
-5.4
-0.6
-33.1
14.0
0.0
-0.1
-0.1
13.8
0.0
13.8
-3.2
10.6
4
Press release 24 January 2023
KEY FIGURES 2022
Consolidated Balance Sheet
Assets
Current assets
Cash and cash equivalents
Financial assets, securities and derivative financial instruments
Trade receivables
Other current assets
Inventories
Prepayments and accrued income
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Investments in associates and joint ventures
Other non-current assets
Deferred tax assets
Total non-current assets
Total assets
Unaudited figures
31.12.2022 | |||||
CHF million | % | ||||
2 176 | 15.6 | ||||
372 | 2.7 | ||||
663 | 4.8 | ||||
103 | 0.7 | ||||
6 873 | 49.5 | ||||
206 | 1.5 | ||||
10 393 | 74.8 | ||||
2 706 | 19.5 | ||||
146 | 1.1 | ||||
19 | 0.1 | ||||
181 | 1.3 | ||||
448 | 3.2 | ||||
3 500 | 25.2 | ||||
13 893 | 100.0 | ||||
31.12.2021 CHF million
1 979
677
710
136
6 389
216
10 107
2 771
144
21
186
449
3 571
13 678
%
14.5
4.9
5.2
1.0
46.7
1.6
73.9
20.3
1.0
0.1
1.4
3.3
26.1
100.0
5
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The Swatch Group AG published this content on 24 January 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 January 2023 06:26:05 UTC.