PARIS - Switzerland’s Swatch Group, the maker of Omega, Swatch and Breguet watches, on Friday said “outstanding” double-digit growth in Asia and the Middle East drove its full-year sales ahead a better-than-expected 17.6 percent.
Swatch, whose other brands include Jacquet Droz, Blancpain and Glashutte Original, said unfavorable currency exchange and rising raw materials costs had “squeezed” margins for the year.
But it said that it expected to report “above-average” increases in operating profit and net income for 2007. Meanwhile, it predicted that strong market conditions for high-end watches would continue this year.
“Despite the current wave of turbulence in financial markets, [Swatch] expects the positive trend to continue,” the company said, predicting double-digit growth for January.
Swatch said sales of its watch and jewelry division last year gained 20.4 percent to 4.71 billion Swiss francs, or $3.93 billion at average exchange rates for the period. Though growth was exceptional in Asia and the Middle East, Europe and America also “recorded solid double-digit growth sales,” Swatch said.
Demand for movements from outside companies contributed to a 20.9 percent rise to 1.68 billion Swiss francs, or $1.4 billion, in sales at Swatch’s production division, while sales at its electronic systems grew 6.2 percent to 630 million Swiss Francs, or $525.6 million.
For complete coverage, see Tuesday’s WWD.