Watches of Switzerland UK and Europe full-year sales fell 5% – in contrast to an 11% jump in the US – as group pre-tax profit plunged 40% to £90m.
On an adjusted EBITDA basis, profits fell 11% to £179m.
CEO Brian Duffy said the UK and Europe was impacted by significant price increases at a time of reduced consumer confidence influencing discretionary spending.
However, he sees these pressures easing in its current financial year and flagged that the UK is “starting to show signs of stabilisation”.
The tourist tax also took its toll as Watches of Switzerland highlighted that the UK performance was driven by a domestic clientele with “minimal return of tourist spending due to lack of VAT free shopping”.
Duffy said: “I am proud of the performance that our team delivered this year in what was undoubtedly a more challenging market. We cemented our position as a leading international luxury watch and jewellery retailer and delivered further market share gains in both the UK and US, driven by our proven, differentiated business model.”
The watch specialist continued to invest in new stores over the year and over the next year will launch the flagship Rolex boutique on Old Bond Street in London and an Audemars Piguet Townhouse in Manchester.
Duffy also flagged the “significant opportunity” that pre-owned watches represented, with sales in this area doubling year on year.
Click here to sign up to Retail Gazette‘s free daily email newsletter
