Signaling more good times ahead for the luxury watch and jewelry sector, Swatch Group AG said 2006 net profits jumped 33.7 percent to 830 million Swiss francs, or $684.9 million, from 621 million Swiss francs, or $512.5 million, and added that 2007 is...
PARIS — Signaling more good times ahead for the luxury watch and jewelry sector, Swatch Group AG said 2006 net profits jumped 33.7 percent to 830 million Swiss francs, or $684.9 million, from 621 million Swiss francs, or $512.5 million, and added that 2007 is off to an "excellent start" with "outstanding prospects."
The world's largest watchmaker also cited additional growth potential for its watch and jewelry brands in all geographic regions, sending a bullish message ahead of next month's Baselworld 2007, where it plans to unveil a new "co-axial" movement for Omega.
Operating profits rose 32.4 percent to 973 million Swiss francs, or $803 million, from 735 million Swiss francs, or $606.6 million, a year ago. Dollar figures are at the current exchange rate.
Full-year sales, reported in January, grew 12.3 percent to 5.05 billion Swiss francs, or $4.17 billion, from 4.5 billion Swiss francs, or $3.71 billion. Swatch cited strong growth in its production division, but more modest results with electronic systems.
Sales of watches and jewelry last year grew the fastest, up 13.8 percent to 3.72 billion Swiss francs, or $3.07 billion, from 3.27 billion Swiss francs, or $2.67 billion a year earlier.
The company cited growth across all brands and price ranges, including the jewelry sector. Its stable includes Breguet, Blancpain, Leon Hatot, Longines, Rado, Tissot and Hamilton.
Operating profits in watches and jewelry leaped 17.9 percent to 738 million Swiss francs, or $609.1 million, from 626 million Swiss francs, or $516.7 million, a year ago, despite a negative currency effect, additional marketing expenses in the U.S., higher gold prices and a new luxury tax in China.
On the production side, the company highlighted a product mix skewed to higher-end movements and components, meaning "a further rise in profitability in this segment is well within the realm of possibility."
Looking ahead, the Swiss conglomerate said the currency situation is favorable, excepting the weak yen, with a strong euro more than compensating for a weak U.S. dollar. Encouraged by strong trading in January and February, it is forecasting further sales growth and a rise in profitability for the current year.In tandem with the results Monday, Swatch announced a new share buyback program valued at 400 million Swiss francs, or about $330.1 million, plus a 40 percent increase in its annual dividend to 3.50 Swiss francs per share, or $2.88.
Analysts applauded the numbers, which beat consensus forecasts.
"We view this strong result as providing a very positive read-across for Richemont," which reports its fourth-quarter sales next month, Goldman Sachs analyst Jacques-Franck Dossin wrote in a research note.
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews
Spotted last night at the @erdem x @hm launch event: Kate Bosworth, Rashida Jones, Kirsten Dunst and Selma Blair. The party, which took place in LA, also marked the opening of their pop-up shop. “I was interested in creating a collection that wasn’t in any way disposable. It was about pieces you’d create and keep forever, things that have a permanence to it,” designer Erdem Moralioglu said. #wwdeye (📷: Katie Jones)
Renee Zellweger in yellow in 2001 and again in 2017. Chosen as one of the 12 @pantone Leading Spring Colors (and dubbed “Meadowlark”), it only makes sense that the bright hue stands the test of time and is making a resurgence this season, seen already on stars like @blakelively and @gigihadid. (📷: Donato Sardello & @rexfeatures) #wwdfashion #tbt
Dior’s 70th anniversary celebration continues with a new exhibition at the Royal Ontario Museum in Toronto. “Christian Dior,” which is scheduled to run through March 18, takes a look at the founders tenure from 1947 to 1057 and feature 40 designs. Pictured here is an evening gown from the Ailée, fall 1948-49 haute couture collection. #wwdfashion (📷: Brian Boyle)
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews