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Sales rise 17% to £429 million at The Watches of Switzerland Group

Brian Duffy Aurum

Global sales rose by 17% to £429 million for The Watches of Switzerland Group in its first six months of trading since going public in May, although the strengthening pound against the dollar shaved 1.4% off the growth rate on a constant currency basis.

The group’s American business is generating an increasing share of total sales thanks to growth in the USA of 42.1% to £111.1 million in the six months to October 27.

The majority of that growth came from the opening of new showrooms, but existing stores, predominately the Mayors network in Florida, saw sales rise by 7.5%.

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UK turnover rose by 10.6% to £317.6 million thanks to rising average sale prices.

Luxury watches now account for 85.3% of sales, up 3% since the prior half year. Jewellery sales dipped by 2.5% and now account for just £31.5 million of the group’s turnover.

Adjusted EBITDA rose by 23.5% to £41.2 million on a slightly improved margin of 9.6%.

“The growth in revenue and profitability is testament to the distinctive luxury experience we provide. Customers continue to react very positively to our showroom portfolio elevation programme – as reflected in increased average selling price, conversion rates, and sales uplift. Our showroom projects in the UK and US have been a success in the year to date. Our omni-channel strategy continues as we expand our mono-brand programme in the UK along with mono-brand openings planned in the US, expansions in UK travel retail and continued momentum online,” says WOSG chief executive Brian Duffy.

In forward guidance, the group says it will complete the acquisition of four Fraser Hart stores in January, 2020. The stores are in excellent locations, according to Mr Duffy, and have combined annual revenue of £25.7m and earnings of £5.0m.

All four will be rebranded as either Mappin & Webb or Watches of Switzerland showrooms.

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Rob Corder

The author Rob Corder