Watches of Switzerland reported a significant fall in profit in 2024 but the firm reiterated its guidance despite the challenging year.
The Rolex seller reported that pretax profit fell 40 per cent in the year to April, falling from £155m to £92m.
Group revenue rose two per cent on a constant currency basis to £1.5bn, with strong growth in the US offsetting weakness in the UK and Europe. Sales across the Atlantic rose 11 per cent in the year compared to a five per cent fall in the UK and Europe.
Boss Brian Duffy noted that sales in Europe were impacted by significant price increases “at a time of reduced consumer confidence” which hit discretionary spending, particularly in the UK.
The firm also noted that performance in the UK was driven by domestic clientele as tourist spending has not recovered due to a lack of VAT free shopping.
“We see these pressures easing in FY25,” Duffy added, noting that the UK market is “starting to show signs of stabilisation”.
Watches of Switzerland noted that it will reallocate investment from the European market to the US and UK reflecting the “high returning opportunities” in those markets.
The firm reiterated its outlook for the 2025 financial year, saying it was “cautiously optimistic”.
“The industry as a whole is being more conservative on production, which we believe is a responsible approach to the long-term stability of the luxury watch market,” Watches of Switzerland said.
“Our strategic momentum underpins our confidence in our FY25 guidance and Long Range Plan objectives of doubling sales and profit by 2028, capitalising on our leading market positions and the unique growth opportunities ahead,” Duffy said.