The Watches of Switzerland Group aims to have global sales of over £1 billion for the year ending April 2021, a 30% increase from its latest turnover figure of £773 million — a number that takes it over the $1 billion target previously set by its leadership team.
Brian Duffy, chief executive of the group, told WatchPro on the day it announced it intends to list on the London Stock Exchange, that there is still huge potential growth for the business in both the UK and the United States.
Watches of Switzerland group owns 21 stores in the United states and over 100 in the UK across its Mappin & Webb, Goldsmiths, Watches of Switzerland and Watch Lab brands (plus Watch Shop online).
Despite the current uncertainty caused by Brexit in the UK and challenges on the high street, Mr Duffy said that interest from investors has been strong.
“We have lived with Brexit for more than two years, so there is potential upside. Also, because of the volume of business we do with Switzerland, which is not in the EU, there is less disruption,” he said.
Another potential risk for investors is Watches of Switzerland’s enormous reliance on key brands, particularly Rolex, Patek Philippe and Audemars Piguet, to generate sales and keep bringing customers to stores.
Mr Duffy says that the brands have been kept informed throughout the process of book building with investors, and have not raised major concerns for the company post-IPO.
The date for the company going public is not set in stone, but Mr Duffy believes it will be in around 4-6 weeks time.
Apollo Global Management, which currently owns 90% of the business is expected to sell at least 25% of the company’s shares, and could sell up to 40%, but will remain the controlling shareholder.
The money will be used to pay down debt, which Mr Duffy says is around £260 million today and likely to be halved to around £130 million.
There will be no material change in direction for the company, or change in the leadership team, but lowering its debt burden could free it to invest in accelerated growth or further acquisitions. “Apollo have been great shareholders, and they love the management,” Mr Duffy says with a smile.