Watches of Switzerland today reports double-digit sales growth in the third – Christmas – quarter of its financial year, with online sales up by 5%. The retailer says it has benefited as demand for the luxury watches it sells exceeded supply during the period, which covered the peak sales trading period in the run up to the festive season.
Watches of Switzerland says today that group revenues came in at £407m in the 13 weeks to January 29 2023. That’s 17% ahead of the same time last year. Sales of luxury watches grew by 22%, generating revenues of £340m – and representing 84% of total revenue for the period. Pre-owned watches also sold well, but luxury jewellery sales fell by 2% to £41m as the retailer focused on full-price sales.
Online sales were 5% up on the the same time last year as Watches of Switzerland expanded its virtual boutique team, increased the availability of next-day delivery and improved its product range. The retailer now offers free next-day delivery for orders placed by 9pm, seven days a week.
Watches of Switzerland chief executive Brian Duffy says: “I am pleased with our strong Q3 performance which is testament to our continued investment in leading showroom design, the strength of our brand partnerships, our scale, our dedication to omnichannel excellence, and our exceptional client service. I would like to thank all my colleagues for their ongoing dedication and hard work especially during the holiday period. Demand remains strong and continues to exceed supply, with client registration lists growing.”
Sales grew fastest in the US – where they rose by more than a third (+36%) to £169m following a number of acquisitions. On a like-for-like basis – excluding the effect of those acquisitions – sales were 17% up on the previous year, when currency fluctuations were also excluded. UK sales grew by 7% to £238m, with sales mostly to UK residents given the “limited return” of tourist spending. During the quarter the retailer continued to refurbish showrooms, and opened its first UK Longines boutique in Glasgow. It also opened its fifth boutique in Europe and will open a sixth – in Dublin – this month.
In the year to the same date, revenues of £1.2bn are 25% up on the previous year. Looking ahead, Watches of Switzerland continues to predict full-year sales of between £1.5bn to £1.55bn, while adjusted earnings before interest, tax and one-off costs (EBITDA) are expected to grow by between zero and 0.5% on the previous year.
Duffy says: “Our expansion into Europe continued with the opening of our fifth mono-brand boutique, with Omega in Stockholm in the third quarter. Early trading remains positive, and we are excited to open our first mono-brand boutique in Dublin with Tag Heuer later this month. Looking ahead, we remain confident that our strategy will further enhance our leadership position as we continue to deliver on our Long Range Plan objectives.”