TIDMWOSG
RNS Number : 1360A
Watches of Switzerland Group PLC
18 January 2024
18 January 2024
Watches of Switzerland Group PLC
Trading Update
Despite a positive start to the early part of Q3 FY24, WOSG then
experienced a volatile trading performance in the run-up to and
beyond Christmas, as the challenging macro-economic conditions
impacted consumer spending in the luxury retail sector. We now
expect these challenging conditions to remain for the balance of
our fiscal year.
Across the UK and US, demand for our key brands continues to be
strong with net increases to Registration of Interest lists. By
market, sales in the US remained strong with continued double-digit
growth. The UK was more challenged, and this impacted a broad range
of luxury watch brands and non-branded jewellery. There was an
unusually high level of promotional activity in non-branded
jewellery.
In light of the recent challenging trading conditions and based
on a more cautious view of the outlook for the remainder of the
fiscal year, management is now providing revised full year guidance
for FY24, which assumes no recovery in consumer demand and reflects
discussions with key brands.
Brian Duffy, Chief Executive Officer, said:
"The festive period was particularly volatile this year for the
luxury sector, with consumers allocating spend to other categories
such as fashion, beauty, hospitality and travel. Whilst we are
disappointed with this trend, we are encouraged by our market share
gains in both the US and UK.
"I would like to thank our colleagues for continuing to provide
high quality service and support to our clients against this
challenging backdrop.
"We remain confident in the markets in which we operate, our
model and the delivery of our Long Range Plan announced to the
market in November 2023."
FY24 Guidance
Organic on a pre-IFRS Previous Guidance Revised Guidance
16 basis
Revenue GBP1.65 - GBP1.70 GBP1.53 - GBP1.55
billion billion
-------------------------- ----------------------
Constant currency
revenue growth 8-11% 2-3%
-------------------------- ----------------------
EBIT margin % In line with FY23 8.7% to 8.9%
-------------------------- ----------------------
Total finance costs c.GBP5 million c.GBP6 million
-------------------------- ----------------------
Underlying tax rate 27% - 28% reflecting c28%
the increase in UK
corporation tax
-------------------------- ----------------------
Capex GBP70 - GBP80 million GBP70 - GBP80 million
-------------------------- ----------------------
Operating cash conversion c70% weighted towards c50%
H2 in line with seasonal
pattern
-------------------------- ----------------------
This announcement contains information which is deemed by the
Company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No.596/2014. Upon the publication of
this announcement via the Regulatory Information Service, the
inside information is now considered to be in the
public domain.
The person responsible for arranging the release of this
information on behalf of the Company is Laura Battley, Company
Secretary and General Counsel.
Conference call
A conference call for analysts and investors will be held at
9.00am (UK time) today. To join the call, please use the following
details:
Dial-in: +44 800 358 1035
Conference access code: 236695
Q3 Trading Update
The Group will announce a Q3 Trading Update for the 13 and 39
weeks ended 28 January 2024 on Thursday 8 February 2024.
A conference call for analysts and investors on the Group's Q3
Trading Update will be held at 9.00am (UK time) on 8 February,
details for which will be provided in the announcement.
Contacts
The Watches of Switzerland Group
Anders Romberg, CFO +44 (0) 207 317 4600
Caroline Browne, Group Finance Director
+44 (0) 1162 817 420
investor.relations@thewosgroup.com
Headland
Lucy Legh / Rob Walker / Joanna Clark +44 (0) 20 3805 4822
wos@headlandconsultancy.com
About the Watches of Switzerland Group
The Watches of Switzerland Group is the UK's largest luxury
watch retailer, operating in the UK, US and Europe comprising five
prestigious brands; Watches of Switzerland (UK and US), Mappin
& Webb (UK), Goldsmiths (UK), Mayors (US) and Betteridge (US),
with a complementary jewellery offering.
As at 29 October 2023, the Watches of Switzerland Group had 211
showrooms across the UK, US and Europe including 97 dedicated
mono-brand boutiques in partnership with Rolex, OMEGA, TAG Heuer,
Breitling, TUDOR, Audemars Piguet, Longines, Grand Seiko, BVLGARI
and FOPE and has a leading presence in Heathrow Airport with
representation in Terminals 2, 3, 4 and 5 as well as seven retail
websites.
The Watches of Switzerland Group is proud to be the UK's largest
retailer for Rolex, OMEGA, Cartier, TAG Heuer and Breitling
watches.
www.thewosgroupplc.com
Disclaimer
This announcement has been prepared by Watches of Switzerland
Group PLC (the 'Company'). It includes statements that are, or may
be deemed to be, "forward-looking statements". These
forward-looking statements can be identified by the use of
forward-looking terminology, including the terms "believes",
"estimates", "anticipates", "expects", "intends", "plans", "goal",
"target", "aim", "may", "will", "would", "could" or "should" or, in
each case, their negative or other variations or comparable
terminology. They appear in a number of places throughout this
announcement and the information incorporated by reference into
this announcement and may include statements regarding the
intentions, beliefs or current expectations of the Company
Directors or the Group concerning, amongst other things: (i) future
capital expenditures, expenses, revenues, earnings, synergies,
economic performance, indebtedness, financial condition, dividend
policy, losses and future prospects; (ii) business and management
strategies, the expansion and growth of the Group's business
operations; and (iii) the effects of government regulation and
industry changes on the business of the Company or the Group.
By their nature, forward-looking statements involve risks and
uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future and may be
beyond the Company's ability to control or predict. Forward-looking
statements are not guarantees of future performance. The Group's
actual results of operations, financial condition, liquidity, and
the development of the industry in which it operates may differ
materially from the impression created by the forward-looking
statements contained in this announcement and/or the information
incorporated by reference into this announcement.
Any forward-looking statements made by or on behalf of the
Company or the Group speak only as of the date they are made and
are based upon the knowledge and information available to the
Directors on the date of this announcement, and are subject to
risks relating to future events, other risks, uncertainties and
assumptions relating to the Company's operations and growth
strategy, and a number of factors that could cause actual results
and developments to differ materially from those expressed or
implied by the forward-looking statements. Undue reliance should
not be placed on any forward-looking statements and, except as
required by law or regulation, the Company undertakes no obligation
to update these forward-looking statements. No statement in this
announcement should be construed as a profit forecast or profit
estimate.
Before making any investment decision in relation to the Company
you should specifically consider the factors identified in this
document, in addition to the risk factors that may affect the
Company or the Group's operations as detailed above.
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END
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