Swatch Group Ltd., the largest Swiss watch business, on Monday said year-over-year gross sales for 2013 increased 8.3 percent to 8.82 billion Swiss francs ($9.7 billion), far outpacing the 1.8 percent growth for the rest of the Swiss watch industry at the end of November.
“This clearly indicates the gain in market share,” the company, which consists of 20 watch brands encompassing all market segments as well as luxury jeweler Harry Winston, said in a statement. “In production, specific capacities have been expanded and put into operation. Additional increases in capacity are either in the planning phase or already under construction.”
The company—which designs, manufactures, distributes and sells finished watches, watch movements, watch components, electronic systems and jewelry—said that excluding production, revenue increased more than 10 percent.
It also forecasts a “positive outlook” for 2014, which has already begun with a “strong start by all brands.”
However, the company warns that that despite its robust growth and forecast, the ongoing over-valuation of the Swiss Franc, particularly against the US dollar and Japanese yen, is having a negative impact on its sales. For example, in the second half of the year, the company said the negative effect of currency exchange rates cost it more than 100 million Swiss francs ($110 million). Its electronics operation reported a decrease of 3.9 percent due to price pressures placed by the overvaluation of the Swiss currency.
Despite this negative currency situation, it expects good results for 2013 at operating profit and net income level. The Swatch Group’s key figures will be published at the latest on 20 February 2014. Publication of the annual report at a media and analysts’ conference on 20 March 2014 is planned.
The company, in its statement, didn’t address a December 30 fire that destroyed its ETA movement operation. These watch movements are among the most common in the industry. They are used to power watches from Swatch Group brands such as Blancpain and Longines and for many other watches used by their competitors. It previously had said it will slow the production of watches by many brands.
Please join me on the Jewelry News Network Facebook Page, on Twitter @JewelryNewsNet and on the Forbes website.
Posts
