By Luxury-watch retailer Watches of Switzerland has revised its guidance for fiscal 2024, citing a volatile Christmas performance and ongoing challenges in the luxury market. Due to challenging macroeconomic conditions, the company expects continued volatility in luxury demand.
The revised guidance predicts revenue for the year ending in April to be in the range of £1.53 billion to £1.55 billion ($1.94 billion to $1.96 billion). This is a decrease from the previous guidance range of £1.65 billion to £1.70 billion. The anticipated revenue growth at a constant currency rate is now expected to be between 2% and 3%, down from the previous range of 8% to 11%.
The downgrade in guidance follows a turbulent period leading up to and following Christmas, despite a positive start to the third quarter.
Watches of Switzerland also adjusted its forecast for earnings before interest and taxes margin, stating that it is now expected to be in the range of 8.7% to 8.9%. Previously, it was projected to be in line with fiscal 2023 levels.
The company attributes the guidance revision to recent challenging trading conditions and a more cautious outlook for the remainder of the fiscal year, which assumes no recovery in consumer demand and reflects discussions with key brands.
While sales in the U.K. have been more challenging, impacting various luxury watch brands and non-branded jewelry, sales in the U.S. remain robust with continued double-digit growth. Demand for key brands in both the U.K. and U.S. remains strong, as evidenced by net increases in registration of interest lists.
Comments