Swiss watch giant Swatch Group has just issued its 2020 half-year report and, as anticipated, its activity has been strongly impacted by the effects of the COVID-19 pandemic. With manufacturing coming to a standstill and retail networks closed, the Group recorded net sales of CHF 2,197 million, -43.4% compared to the previous year at constant exchange rates, or -46.1% at current rates.
These results are clearly not a surprise, as exports of Swiss watches (as reported by the FHS) were down 35.8%, over the first five months of the year – with -81% in April and -68% in May. Swatch Group underlines that the lockdowns policies applied in most countries led to the closing of up to 80% of all retail stores worldwide (Group stores and third-party stores) and that only e-commerce distribution was partially feasible. The Swatch Group recorded an operating loss of CHF 327 million compared to an operating profit of CHF 547 million in the previous year.
To end on a positive note, Swatch Group reports that there is “very high customer demand in all price segments in markets which have already overcome the lockdown” and “double-digit growth in mainland China in May and June compared with the previous year.” The group expects a strong second half of the year and a positive operating result for the entire year 2020. Several cost-saving measures have been implemented; the number of employees has decreased since December 2019 by 6.5% to approximately 33,700 persons.
For more information, please visit www.swatchgroup.com.