Swatch: 'opportunities' in sight, but results disappoint
January 23, 2024 at 02:45 pm IST
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On Tuesday, Swatch Group said it was looking forward to major "opportunities" in 2024, despite weaker-than-expected results last year, a disappointment that was punished by a sharp drop in its share price.
In 2023, the Swiss watchmaker's operating profit (Ebit) reached 1.19 billion Swiss francs, compared with 1.16 billion in 2023, while analysts were expecting an average of 1.34 billion francs.
Gross sales rose by 5.2% to 7.89 billion Swiss francs (+12.6% at constant exchange rates), compared with the consensus figure of 7.96 billion.
Swatch announced plans to increase its dividend from 1.20 to 1.30 francs per registered share and from six francs to 6.50 francs per bearer share.
In its press release, Swatch also stated that it anticipated "excellent growth opportunities" in 2024, despite the "problematic" strength of the Swiss franc.
Its luxury brand Harry Winston should exceed sales of one billion Swiss francs this year, while Swatch, Tissot and Longines should continue to develop in the entry- and mid-range markets.
As for Omega, the brand should benefit from its exposure at the Paris Olympic Games, where it will be the official timekeeper of the events, adds the group.
Swatch shares nevertheless lost more than 3% in a stable Swiss stock market. The stock has lost almost a third of its value over the last 12 months.
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The Swatch Group SA is a Switzerland-based holding company engaged in the apparel and accessories industry. The Companyâs activities are divided into two core business segments: Watches and Jewelry, as well as Electronic Systems. The Watches and Jewelry segment includes the production and sale of branded watches, jewelry and quartz movements, notably the brands Breguet, Harry Winston, Blancpain, Glashuette Original, Jaquet Droz, Leon Hatot, Omega, Longines, Rado, Union Glashuette, Tissot, Balmain, Certina, Hamilton, Calvin Klein watches and jewelry, Swatch and Flik Flak. The Electronic Systems segment includes the production and marketing of electronic components, notably batteries and sports timing equipment. The Company also supplies products from these segments to third-party watchmakers. Swatch Group SA is represented worldwide through its subsidiaries and distributors, notably Tourbillion and Hour Passion, and operates Swiss production plants in Boncourt, Grenchen and Villeret.