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Key takeaways

Watches of Switzerland Group achieved record revenue last year thanks to strong sales in the United States.The US market now accounts for more than half of the company’s total revenue.Despite challenges in the sector, Watches of Switzerland expects continued revenue growth and margin improvement.

Driven by strong sales in the United States, Watches of Switzerland Group achieved record revenue last year. The company expects adjusted earnings before interest and tax to reach as much as £155 million (€180 million), beating earlier forecasts. This impressive performance is attributable to a 13 per cent increase in revenue to £1.8 billion (€2 billion) in the 53 weeks to 3 May.

Dominance in the US market

The US market, which Watches of Switzerland only entered eight years ago, now accounts for more than half of the company’s total revenue. This important milestone underlines the company’s commitment to doubling both revenue and profit by 2028.

In response to the positive news, Watches of Switzerland’s share price jumped by as much as 17 per cent in early trading in London, amounting to an impressive gain of more than 52 per cent over the past year.

Positive outlook despite challenges

Despite challenges such as rising raw material costs and consumer uncertainty in the watch industry, Watches of Switzerland expects revenue growth of up to 10 per cent for the current financial year, along with a further expansion of the adjusted profit margin before interest. This optimistic outlook contrasts with the company’s statement in February, which suggested that margins would be slightly lower as a result of price increases by brands, driven by higher raw material costs and the US import tariffs imposed by President Donald Trump.

Analyst Kate Calvert of Investec Bank highlights the “strong momentum” at Watches of Switzerland and attributes this to robust demand for watches, a promising project pipeline, benefits arising from recent acquisitions, and the strengthening of the pre-owned and jewellery segments. (fc)

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