Turnover for Breitling UK Limited increased by 14.4% in 2016 to £42.2 million, but profit dipped due to a weaker pound making imports of Swiss watches more expensive for the London-based subsidiary.
“The consolidated wholesale network continued to grow and benefited from enhanced above the line marketing throughout the territory,” says Breitling UK managing director Gavin Murphy in an introduction to the financial results for the year ending December 31, 2016.
“Continued work on stock management at store level via Breitling’s e-Warranty system, extensive traning of the personnel and clearer brand identity within the stores all contributed to a very solid result in what was an unpredictable year,” Mr Murphy explains.
Breitling’s UK sales appear to have benefited from an influx of high-spending overseas visitors taking advantage of the weaker pound after the Brexit vote.
“Investment at retail retail at the Bond Street store and its CRM platform coupled with a wider international mix of clients post-Brexit provided strong retail sales growth,” Mr Murphy describes.
The Brexit impact was not all positive, Mr Murphy suggests. “With the impact of the Swiss franc exchange rate, this has seen the overall company’s profit decrease from £1,549,038 to £379,488,” he states.
“The decision for Britain to quit the EU put pressure on the sterling and Swiss franc exchange rate and a decision was made to compensate for this movement with a price increase in October 2016 with a view to monitor moving into 2017,” he adds.
Breitling was acquired in April this year by CVC Capital Partners, a London-based private equity group.
The terms of the deal were not been disclosed, but Bloomberg quoted unnamed insiders at the time putting the value of the sale at around 800 million euros.
CVC, which is the largest private equity investment firm in Europe, took an 80% stake in Breitling.