Watches of Switzerland reports revenue growth of over 20%

Watches of Switzerland has reported revenue growth of more than 20% in the first 10 weeks of FY21, up to 4 October 2020. The jewellery group said this represents a “stronger than expected” performance given the disruption caused by the Covid-19 pandemic.

In the UK, sales were up 12.6% year-on-year during this period, which has been driven by eCommerce growth of 49.9% and strong regional store sales. It noted this more than offset reduced tourist and airport sales, which only accounted for 9.2% of revenue compared with 32.5% in the previous year.

Watches of Switzerland added that new product launches have been “stronger than anticipated” while improved customer engagement and sales conversion has been achieved through CRM and clientelling activities and appointment management.

This followed comments by its CEO Brian Duffy in May that the company was anticipating a prolonged period of lower store traffic for some time due to Covid-19. He suggested that eCommerce, customer relationship management (CRM), and clienteling would grow in importance for the business as a result. The company has since launched a new online appointment tool, giving customers the chance to book expert advice and consultations in store, on the phone, or via video conferencing platform Zoom.

In the trading update, the group, which runs luxury jewellers Goldsmiths, Mappin & Webb, and Watches of Switzerland, said it has now revised up its expected revenue for FY21 from £880 million to £910 million.

Duffy commented: “Trading momentum has further improved in Q2. Stronger than anticipated UK domestic sales are offsetting lower tourist and airport traffic, whilst regional stores are continuing to outperform London stores. Furthermore, the strong momentum we have established in the US has further accelerated. All US regions are contributing to this positive trend.

“Our guidance for the balance of the fiscal year assumes that the positive trend experienced in Q2 will be moderated by the impact of pandemic related retail disruption in the UK and the US and uncertainty in the US economy, impacting mainly in Q3. We do not assume any improvement in recent trends regarding the travel or tourist sectors.

“Looking ahead, we will continue to focus on our strategy by investing in high quality growth through selective capital projects and targeted marketing activity."