Swatch Group reports record December despite currency battles

In 2011, sales at the Swiss watch company exceeded CHF 7 billion (£4.78 billion) for the first time. Gross sales for the Group were up 21.7% compared to 2010, and gross sales increased 26.1% in the watch and jewellery divisions with reports of double-digit growth rates for almost all brands in this segment.

The positive trading report comes despite the ongoing overvaluation of the Swiss Franc, particularly against the US Dollar and the Euro, which impacted the Group’s sales by -10.8% or CHF 696 million (£474.7 million). However, despite this extremely negative currency effect, sales in CHF increased by 10.9% over the previous record year 2010.

The strong Group brands experienced significant growth, not only in Greater China but also in all other regions and all price segments. The watch and jewellery division recorded an increase in sales of 26.1%, with investment in retail activities as well as numerous marketing offensives throughout the world contributing to the sales figures.

The Production segment also experienced “an enormous increase in demand for all types of components” and this strong growth contributed to a marked gross sales increase of 32.6%.

However, the Group did acknowledge that despite further expansion of production capacity, “there were and still are major production bottlenecks”.

The statement from Swatch asserted despite the “strongly negative” currency impact during the course of the year and “our traditionally defensive policy concerning price increases”, management at the Group expected good results for operating profit and net income.

It added that 2012 will be a major challenge but that the Swatch Group is confident of again generating qualitative growth in 2012.

The Group’s key figures will be published at the latest on February 23, 2012.

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