Watches of Switzerland posts dip in sales following slowdown in luxury retail spending
Watches of Switzerland Group saw its group revenue dip by 1% to £397 million at constant currency in its third quarter due to trading in the run-up to Christmas being tougher than expected.
In the 13 weeks to 28 January, revenue in the UK and Europe fell to £222 million from £238 million in the corresponding period in the previous year.
The group attributed the decline to challenging conditions in the UK and the resulting impact on consumer spending in the luxury retail sector. It also highlighted how consumers are allocating any discretionary spend to other categories such as fashion, beauty, hospitality and travel.
However, revenue in the US rose by 8% at constant currency to £175 million in the period as the group gained market share in the fragmented US luxury watch market.
Group ecommerce sales were down 15% on the prior year due to the mix of products through the channel and the performance of the UK market
Looking ahead to the outcome of its full year, Watches of Switzerland reconfirmed its guidance of 18 January when it said it expected revenue to come in at between £1.53 billion and £1.55 billion.
The group said it was encouraged by the UK Office for Budget Responsibility’s review of VAT free shopping for tourists.