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emand for luxury timepieces “continues to outpace supply”, retailer Watches of Switzerland said, as years-long waiting lists for its most in-demand timepieces got even longer, despite it raising prices.
Higher prices, alongside a continued rise in sales volumes, helped the business report revenue of £1.5 billion and profit of £155 million for the year.
CEO Brian Duffy told the Standard that watch makers had avoided hiking prices too drastically, citing lengthening waiting lists for ‘grail’ watches like the Rolex Submariner..
“The brands have been very responsible,” he said.
But the retailer is also running behind schedule on opening a new Rolex shop on Old Bond Street. Duffy said the design of the shop, which Rolex and Watches of Switzerland are working together on, “is taking a bit longer than we had hoped”.
Luxury watch sales grew by 28% year-on-year, and luxury jewellery sales jumped by a 10th.
“Consumer appetite for products remained strong and, in many instances, well above the levels that the group is able to supply”, the firm said.
Luxury watch demand remains strong and continues to outpace supply, with our client registration lists extending and average selling prices growing
The group’s statutory pre-tax profit jumped by nearly a quarter, from £126 million to £155 million in the latest year.
The record year for revenues and profitability came despite a more challenging trading environment during the second half of the financial year, Watches of Switzerland said.
It was also driven by a surge in revenues in the US of more than a third.
In the UK, tourist sales remain “very low” and demand was driven by domestic customers, but more shoppers returned to airports during the year, it revealed.
The retailer, which also sells brands including Cartier, Tudor, and Patek Philippe, has been shaking up its chain of shops around the country.
It opened five showrooms at Battersea Power Station in London and 10 single-brand boutiques across the UK, but closed six showrooms elsewhere.
It is also due to open a new showroom in St Anne’s in Manchester and a flagship store Old Bond Street in London next year.
The firm expects to report slower revenue growth of between 8% and 11% next year.
Brian Duffy, Watches of Switzerland’s chief executive, said: “Luxury watch demand remains strong and continues to outpace supply, with our client registration lists extending and average selling prices growing.”
Danni Hewson, the head of financial analysis at AJ Bell, said: “The fact it has achieved stellar growth in a cost-of-living crisis shows that not everyone is short of money.
“The market has previously worried that the luxury goods market might not be as resilient as previously thought.
“Despite the uncertain economic backdrop, the fact Watches of Switzerland hasn’t downgraded its guidance has been taken as a massive positive in the eyes of investors.”
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