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Articles from WATCHES (694 Articles)

Despite mediocre financial results, Swatch anticipates ‘healthy’ figures in the year ahead. Image courtesy: <a href="" target="_blank">Facebook/Swatch AU</a>
Despite mediocre financial results, Swatch anticipates ‘healthy’ figures in the year ahead. Image courtesy: Facebook/Swatch AU

Swatch sales continue to plunge

Although Swatch Group has released less than stellar financial results for 2016, ‘healthy’ figures were anticipated for the year ahead.

Net sales for the 12 months ended 31 December 2016 totalled CHF7.5 billion ($AU9.9 b). This represented a 10.6 per cent decrease at current exchange rates when compared to the previous year.

Net income was CHF593 million (AU$780 m), 47 per cent lower than 2015.

According to the company’s 2016 annual report, the past financial year was marked by worldwide turbulence in a ‘very challenging’ economic environment.

“The decline in consumption, already evident since the end of 2015, intensified particularly in the first half of 2016,” the report noted. “As in the previous year, the tragic terrorist attacks in France, Belgium, Germany and Turkey, as well as new legal regulations in various countries, led to rapid regional shifts.”

The overvalued Swiss franc was also highlighted as a contributing factor to the negative result.

Watch and jewellery dip

The watch and jewellery division of the business – including production – generated CHF7.3 billion (AU$9.6 b) in net sales, representing a 10.7 per cent decline.

The company statement noted that the decrease was tied to production and its significantly lower ‘capacity utilisation’ compared to the previous year. 

However, a positive outlook in this segment was predicted for 2017: “Thanks to the maintaining of production capacities, as well as a highly motivated workforce, we can immediately respond to the expected increased demand, which will also lead to an improved situation in this area in 2017.”

The statement concluded that consumer interest and the potential for Swiss watches remained strong.

“Based on the positive sales figures in all segments in recent months, including January 2017, Swatch Group anticipates healthy growth in 2017,” the report read.

Swatch Group is involved in the design, manufacture and sale of finished watches and jewellery. It supplies watch components and movements to its brands and third-party watchmakers.

Founded in 1983, Swatch Group is headquartered in Switzerland. The company has 18 watch brands in its portfolio, including Omega, Harry Winston, Calvin Klein and its namesake, Swatch.

More reading
Swatch sales decline by $12 billion
‘Worldwide turbulence’ blamed for Swatch sales decline
Swatch group prices to rise
Swiss watch brands outraged over currency decision

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Sunday, 19 January, 2020 03:06pm
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