Watches of Switzerland: Why shares in Rolex seller are on the road to recovery
Shares in Rolex seller Watches of Switzerland have surged to their highest value since January after the retailer revealed positive half-year results.
The Leicester-headquartered group reported a revenue of £785m for the six months to 27 October, 2024, a four per cent rise.
In a trading update issued to the London Stock Exchange, Watches of Switzerland said that while its UK market remained solid, its US performance was a key driver in its most recent financial success.
But despite the rise in group revenue, the retailer’s statutory pre-tax profit for the period fell by 39 per cent from £67m to £41m.
Off the back of the half-year results, shares in the group surged by more than 13 per cent to trade at around 566p each as of 11am on Thursday, 5 December.
The price is the highest shares in Watches of Switzerland have been since they were worth 587p each on 17 January.
In the last 12 months, shares in the group have been as high as 715p each – on 11 December, 2023, but fell sharply just over a month later to 371p.
In 2024, shares in Watches of Switzerland have been as low as 325p – in May.
Rolex seller hails ‘encouraging’ performance
Chief executive Brian Duffy said its half-year results were “driven by growing demand in the UK and US, and consistent growth in client registration lists, along with the acquisition of Roberto Coin in the period”.
He added: “As previously outlined, in Q1 we increased showroom stock levels of key brands to enhance displays and client experience, particularly in the US.
“With the stock rebuild complete, in Q2 we drove significantly improved US revenue of +24 per cent (constant currency) and revenue in the UK market turned positive.
“Price increases from brands in the half have been modest, and this has also positively influenced consumer sentiment. Consequently, overall group revenue increased +11 per cent in Q2, in constant currency.
“Our newly acquired Roberto Coin business in North America has traded strongly since acquisition and is now making a good contribution to our group.
“Integration is progressing well, and growth plans are underway.
“We are also encouraged by the performance of the Rolex Certified Pre-Owned programme and the sustained growth in our overall pre-owned business.
“Additionally, we acquired Hodinkee, a leading global digital platform for luxury watch enthusiasts, further strengthening our online sector leadership. Integration is progressing in line with our expectations.”
On its current trading during the third quarter of its financial year, Watches of Switzerland’s CEO said its performance has been “encouraging” and that its “showroom transformation programme” is continuing.