Watches of Switzerland Reports FY25 Trading Update
Why we think this is neutral
The trading update from Watches of Switzerland indicates a mixed performance. While the company reported solid revenue growth, particularly in the second half, the outlook remains cautious due to broader macroeconomic and consumer environment uncertainties, including potential US tariff changes. Profit/EBITDA is expected to be in line with market expectations, but without more detailed financial information, a full assessment of the company's performance is limited.
Key Points
- Full year Group revenue of £1,652 million, up 8% in constant currency (7% reported)
- US revenue up 16% in constant currency (14% reported)
- Improved second half performance with Group revenue up 12% vs 4% in H1
- Cautious outlook due to uncertain macroeconomic backdrop and potential US tariff changes
- Adjusted EBIT expected to be in line with market expectations
- Significant strategic progress with new showroom openings and acquisitions integration
Summary
Watches of Switzerland Group PLC reported full year revenue of £1,652 million, up 8% in constant currency (7% reported), in line with market expectations. The company saw improved performance in the second half, with Group revenue up 12% compared to 4% in the first half. The US market was a particular bright spot, with revenue up 16% in constant currency (14% reported) for the full year.
However, the company cautioned about the uncertain macroeconomic backdrop, including potential US tariff changes, which could impact future trading patterns. Adjusted EBIT is expected to be in line with market expectations.
The company made good strategic progress, including the opening of a new flagship Rolex boutique in London and several other showroom developments in both the UK and US. The integration of recent acquisitions, Hodinkee and Roberto Coin Inc., are also progressing well.