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Swatch Group 2020 Results Show the Impact of the COVID-19 Pandemic

Sales and profitability down due to pandemic, improvement over the second half of 2020.

| By Xavier Markl | 1 min read |

The watch industry has taken a big hit during the pandemic. Swatch Group has just released its 2020 results and, as expected, these have been severely impacted. At CHF 5,595 million, net sales are down 28.7% at constant exchange rate and 32.1% at current rates. The operating results remain slightly positive at CHF 52 million (versus CHF 1,023 million in 2019) while the group records a net loss of CHF -53 million (versus net income of CHF 748 million in the previous year.) The second half of 2020 showed a gradual improvement of the activity: net sales were down 14.3% compared with the previous year and Swatch mentions a “strong December despite renewed lockdowns in important markets such as Germany and Great Britain“.

Although the industry situation remains uncertain, Swatch Group anticipates a “strong catch-up in consumption worldwide for watches and jewelry in 2021” and hopes to see its sales return close to 2019 levels. Swatch Group also hopes to capitalize on some of its successful products such as the new Omega Moonwatch, the Longines Spirit collection, or the recently launched T-Touch Connect Solar.

From a market perspective, the impact of the COVID-19 pandemic on the transformation of the group (and of the industry) business was tangible with 384 retail locations stores closed, while 55 have been opened. E-commerce sales were up 70%. The proportion of e-commerce for brands in the middle and basic price segment has now reached between 20% and 30%.

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