A soaring Swiss franc trimmed 7.4% from net sales at Swatch Group in 2023, according to its end of year financial report.
Global sales rose by 12.6% to CHF 7.9 billion at constant exchange rates, which was nipped to 5.2% when reported in the Swiss currency.
Sales grew by over 8% in the fourth quarter in local currencies.
Operating margin was maintained at 17.2%, delivering a CHF 1.2 billion operating profit, up from CHF 1.16 billion in 2022.
Swatch Group says it has outperformed its Swiss rivals, reporting growth in exports of 11.9% in the first 11 months of the year, compared to the wider market’s 7.9% rise, as reported by the Federation of the Swiss Watch Industry.
The Group’s brands were comparatively strong in Asian markets before the pandemic, and that advantage appears to be helping it gain global market share.
Double-digit growth was achieved in Hong Kong SAR, Macao, Thailand, India, Japan, and China last year, Swatch Group says.
Europe’s growth was more slugging, in the single-digits, although this excludes sales within Switzerland, which rose 30%.
Overall growth in North America was not disclosed, but Omega, Tissot and Swatch delivered record in the territory.
Globally, Longines, Tissot, and Harry Winston were singled out for delivering high double digit growth.
Swatch Group invested around CHF 360 million in retail. Over CHF 220 million was spent buying properties in prime locations that could be used for its own stores.
A recent acquisition was a large property on Old Bond Street, which neighbors the building where Watches of Switzerland Group is creating the country’s largest Rolex flagship.
The real estate business of Swatch Group is beginning to rival its watchmaking, with acquisitions over several years totaling around CHF 3 billion. All properties are mortgage-free and currently valued at around CHF 4 billion.
Swatch Group 2024 forecast
Looking ahead, Swatch Group gives an optimistic forecast for this year.
Swatch, Tissot and Longines are expected to develop strongly in the lower and medium price segments, Omega will benefit from publicity as official timekeeper of the Olympic Games in Paris and Blancpain is gaining brand recognition following the launch the Swatch bioceramic Fifty Fathoms in 2023.
Harry Winston is expected to be Swatch Group’s first billion dollar jewellery and watch brand this year.
