©Bloomberg
Swiss watchmaker Swatch expects record sales this year as China reopens and tourism resumes after Covid-19, boosting sales in the region.
Last year’s net sales reached CHF 7.5 billion, up 4.6% year-on-year at constant exchange rates. Operating profit increased by 13% to 1.16 billion francs ($1.3 billion), falling short of analyst estimates of 1.19 billion francs.
However, with the exception of China, where the Covid-19 lockdown resulted in a sales deficit of more than CHF700 million, sales in local currencies rose by 25% in all regions.
“After the end of Covid-19 measures, consumption recovered rapidly not only in China, but also in peripheral markets in Hong Kong SAR and Macau,” Swatch said in a statement on Tuesday.
It added that the easing of travel restrictions in China “will revitalize sales in tourist destinations” and that sales growth in China in January “reinforces the group’s expectations of aiming for a record year in 2023.” said.
It said Beijing’s zero-Covid strategy over the past three years had “significantly slowed” growth.
Swatch has “significantly” increased spending on inventory, raw materials, work-in-progress and semi-finished products given potential energy shortages and delivery bottlenecks, the company said.
“This measure will pay off given the increased demand in China after the end of the zero Covid strategy,” he said.
The company posted double-digit sales growth in Europe, the Americas, the Middle East and most of Asia excluding China.
Swatch launched the MoonSwatch collaboration in March. This is his £207 plastic version of Omega’s Speedmaster, and thousands of shoppers around the world have lined up to buy it. Recorded 1 million sales.
