Swiss watchmaking group Swatch has reported a sharp drop in sales and profits for the first half of 2024, mainly due to lower demand in China. Despite this setback, the group anticipates a positive outlook for the second half, thanks in particular to strategic investments and a cost-cutting program.
The Swatch Group, the world’s leading watchmaker, announced on Monday July 15 a significant decline in sales and profits for the first half of 2024. The decline is mainly attributed to lower demand in China, a key market for luxury goods.
Net sales for the Swiss group, maker of Tissot, Longines and Omega watches, fell by 14. 3% at constant exchange rates, to 3.445 billion Swiss francs (3.53 billion euros).
This result was below analysts’ expectations, who had forecast 3.75 billion Swiss francs (3.84 billion euros ) according to the Visible Alpha consensus. Including negative currency effects, sales fell by 10.7%.
Operating profit also fell drastically, from 686 million to 204 million Swiss francs (703 million to 209 million euros), representing an operating margin reduced from 17.1% to 5.9%. Net income, meanwhile, fell by 72% to 147 million Swiss francs (150 million euros) from 498 million (510 million euros) in 2023.
The Group also pointed out that first-half sales had been impacted by a negative exchange rate effect of 145 million Swiss francs (148 million euros).
Slowdown in the Chinese market
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Read also>SWISS WATCH EXPORTS DECLINE IN MAY
Featured photo : © Swatch Group
