Watches of Switzerland shares soar as the company reported a modest increase in group revenue, helping to squash fears about slowing demand.
Sales hit £1,538 million, which represents a 2% growth at constant currency but remained flat at reported rates compared to the previous year.
Watches of Switzerland share price was 10% higher at the time of writing.
Investors have become nervy about demand for luxury watches and today’s results will go along way to dispel these fears.
The luxury watches segment, which accounts for 87% of the group’s revenue, showed resilience with a 3% increase in constant currency terms and a 1% rise in reported figures. This performance was particularly strong in the US market, where the company continued to gain market share.
Demand for key brands, especially products on the Registration of Interest lists, remained robust and outstripped supply.
However, the luxury jewellery segment experienced a decline, with revenue falling by 13% in constant currency and 14% in reported terms. Despite this overall decrease, the company noted an improvement throughout the year, with the fourth quarter of FY24 showing the best performance.
Luxury branded jewellery significantly outperformed non-branded jewellery during this period. This is the main driving force behind the gains in shares today.
The UK market, which has been particularly challenging, showed signs of stabilisation. UK and Europe sales were down 5% for the year, impacted by significant price increases and reduced consumer confidence affecting discretionary spending. The company expects these pressures to ease in the coming financial year.