Swatch Group is a publicly listed company that publishes comprehensive accounts for its global operation, but provides virtually no information on how its international subsidiaries perform and how much each country contributes to global turnover and profit.
In the UK, we have Companies House, so the accounts of Swatch Group UK Limited are a matter of public record. WatchPro has been publishing information from these accounts for many years and they contribute to our State of the Nation reports.
The Swatch Group figures always seemed startlingly low. In 2017, for example, Swatch Group UK reported sales of just £85 million. This seemed implausibly little for a group responsible for Omega, Longines and Tissot. To put it in context, Patek Philippe, alone, reported sales of £155 million in the same year.
However, repeated requests for Swatch Group to explain its figures have been declined, so WatchPro has shared the only figures we have.
The latest accounts for Swatch Group UK show turnover leaping from £85 million in 2017 to £160 million in 2018. Operating profits rose from £3.3 million to £5.2 million.
WatchPro again asked Swatch executives for an explanation, but were again told that their corporate policy was not to comment.
We turned instead to executives at leading retailers that work with Swatch brands for clues. The only plausible explanation is that more product has been routed through the UK subsidiary than in previous years. In other words, where in the past watches might have been purchased directly from Switzerland, from 2018 they were bought by Swatch Group UK before being sold to retailers or direct to consumers through boutiques or ecommerce.
The value of stock reported in 2018 for Swatch Group UK was £46 million, up from just £2.3 million in 2017, which supports this theory.
WatchPro‘s conclusion, which we put to Swatch Group UK but could not get confirmed, is that UK sales for Swatch Group have been substantially under-reported and the £160 million turnover figure for this year is closer to reality on the ground.
We have it on good authority that Omega sales total around £100 million, Longines is £30 million and Tissot £25 million. These values are at retail, so wholesale turnover of £160 million is a plausible figure if sales of all (or far more of) Swatch Group products are now routed through its UK subsidiary.