PARIS — Swatch Group said Friday it plans to slash its planned dividend by 30 percent and cut board members’ pay to reflect the “drastic” impact of the coronavirus on the economy.
The world’s biggest watchmaker, with brands ranging from high-end Breguet timepieces to plastic Swatch watches, said it plans to recommend the measures to its annual general meeting, scheduled to take place on May 14 without a reduced number of attendees.
“In view of the COVID-19 situation and the drastic consequences for the economy, the board of directors has decided to take a prudent approach to the company’s financial resources and therefore recommends to the general meeting to approve an approximately 30 percent lower dividend than originally planned,” the group said in a statement.
The board also recommended a 30 percent cut in the fixed compensation of board members for board functions this year. This represents only a fraction of the fixed pay of executives including Swatch Group chairwoman Nayla Hayek.
The group said last month it had temporarily reduced and in some cases halted production, but was keeping factories open. In China, where its shops were closed for around five weeks, business was gradually returning, Swatch Group chief executive officer Nick Hayek said at the time.
Asked for guidance on sales this year, Hayek stressed the unsettled environment: “The whole situation of 2020 is a little bit rocking us and shaking us and we are saying ‘What are we going to do here or there?’”