ZURICH (Reuters) – Swatch Group is positive about China market recovery from the COVID-19 fallout and the return of Chinese tourists abroad, the Swiss watchmaker said on Tuesday after it reported a 2.5% increase in its 2022 sales.
The maker of high-end brands Omega, Tissot and Longines watches as well its eponymous mass-market plastic watches said its sales increased to 7.49 billion francs ($8.13 billion).
The constant currencies sales jump of 4.6% fell short of its goal for a double-digit increase, and was attributed to a big downturn in China during 2022, where COVID-19 lockdowns triggered a massive drop in sales.
Net profit rose to 823 million francs from 774 million francs reported a year earlier, Swatch said.
Still, the company was upbeat about a recovery in China, a key market for the luxury sector overall and Swatch Group in particular where it generates around a third of its sales, according to estimates by Zuercher Kantonalbank.
“Group Management anticipates strong sales growth in 2023 in all regions and segments,” it said.
“After the end of COVID measures, consumption quickly recovered, not only in China, but also in the surrounding markets of Hong Kong SAR and Macau. In addition, lifting of travel restrictions in China will revitalize sales in tourist destinations,” it added.
($1 = 0.9214 Swiss francs)
(Reporting by John Revill; Editing by Kim Coghill and Sherry Jacob-Phillips)
