Swiss watch firm reports good sales as net profit rose to Sfr1.9bn, beating estimates for Sfr1.6bn
Swatch Group - the world's biggest watch company - has unveiled a better-than-expected 20% jump in annual profits and said it expects further healthy growth this year .
The Swiss firm's brands - which include upmarket Omega and Breguet timepieces - had an "auspicious" start to the year, and both watch and jewellery sales have been very good in January, Swatch said yesterday.
It added: "After four years of strong and dynamic growth by Swatch Group, as well as the entire Swiss watch industry, continued healthy growth is expected in 2014."
Net profit rose to Sfr1.9bn, beating estimates for Sfr1.6bn in a Reuters poll. The result was boosted by a payment of Sfr402m in damages from US jeweller Tiffany after a partnership between the two soured.
The company, best known for the plastic Swatch watches that gave the group its name, posted a 9% rise in full-year sales to Sfr8.8bn last month, with double-digit sales growth this year on the back of stronger demand in China.
Last year, Swiss watchmakers sold fewer watches in China, where the government put a halt to illegitimate gifting. However, Swatch fared better than rivals because its Tissot and Longines brands, which do not cost enough to be considered possible bribes, still sell well to China's rising middle classes.
Swiss watch exports rose 1.7% in the 11 months to November, well below the double-digit growth rates of previous years. Sales to Hong Kong and China, which absorbed a quarter of exports, fell 6% and 15% respectively.
Rival Richemont, which is more focused on high-end timepieces, last month reported quarterly sales growth of 9% despite lower sales in China. The world's biggest luxury group LVMH said last week that sales of its watches and jewellery rose 4% last year.
source Guardian
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