By Avi Krawitz
RAPAPORT… Swatch Group posted a decline in sales in the second half of 2008, but said it expects to see some modest growth through 2009. According to Rapaport calculations (see table below), group net sales in the second half fell 6.3 percent to CHF 2.853 billion ($2.469 billion), while gross watch and jewelry sales declined 5.6 percent to CHF 2.451 billion ($2.122 billion). The company did not provide separate half-year sales figures in its full-year report published Thursday.
“A noticeable drop in demand in the last months of 2008 mainly at [the] wholesale level reduced the momentum in most brands and markets,” the watchmaker explained in the report. Swatch’s full-year results were more encouraging, as the company posted a 0.5 percent rise in net sales to CHF 5.677 billion ($4.908 billion). Its watch and jewelry segment saw gross sales increase 1.8 percent for the year to CHF 4.796 billion ($4.151 billion). Swatch said it was focusing on expanding its retail segment as it continued to outperform its wholesale activities.
Sales growth in the watch and jewelry segment was most profound in China and the Middle East, where Swatch posted double-digit increases. Sales in Europe and the U.S. showed more modest growth, “with recession fears starting to weigh on consumer confidence in several countries and markets towards the end of 2008,” the company explained.
Swatch offered a “cautious but not pessimistic” outlook for the next few months in light of to the ongoing financial turmoil, but stressed it did not expect a disastrous quarter. “A decrease in the first three to four months compared to the very high previous year figures indicates a rather manageable recession,” Swatch stated. “A mild increase in consumption and sales for 2009 is expected, because of an anticipated rebound in the second half of 2009.”
Swatch Group Sales Report
All figures in Swiss Francs (millions) Total Net Sales Watches & Jewelry Gross Sales
2008 2007 % Change 2008 2007 % Change
Full Year 5,677 5,646 0.5% 4,796 4,710 1.8%
First Half 2,824 2,601 8.6% 2,345 2,113 11.0%
Second Half 2,853 3,045 -6.3% 2,451 2,597 -5.6%
First-half sales as presented in the company’s report dated August 15, 2008.
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RAPAPORT
Information that means Business
Source: www.diamonds.net/news
