Swatch Group rears its head and returns to profit after the severe difficulties experienced in 2020 due to the Covid 19 pandemic. The Swiss watch group which also owns the Omega, Tissot and Longines brands, in 2021 achieved profits of 774 million of Swiss francs, approximately 747 million euros. A result exceeding analysts' expectations which compares with the net loss of 53 million francs in the previous year.
Turnover is up sharply, which rose by 30,7% at current exchange rates (+29,6% at constant exchange rates) to CHF 7,313 billion over the twelve months, a level which, however, still remains below the figures achieved in the period pre-pandemic, when revenues had reached 8,2 billion francs. Analysts had expected slightly higher revenues.
THEoperating profit it came in at 1,021 billion Swiss francs compared to 52 million francs a year earlier, with the operating margin increasing from 0,9% to 14%. In 2019 it was 12,4%. The Watches and Jewelry division (excluding manufacturing) had an operating margin of 17,7% last year.
Going forward with the parameters, in 2021 operating cash flow was 1,298 billion compared to 819 million in 2020, while free cash flow rose from 675 million in 2020 to 1,033 billion in 2021.
The board has not yet made a decision on the dividend but intends to do so at its next meeting, the group said in a statement. For the year 2022, the group management predicts double-digit sales growth net of exchange rates, with a record increase in terms of turnover. “Omega will have a global media presence in February as timekeeper of the Beijing Winter Olympic Games, and Tissot will be visible far beyond the Chinese market in September as timekeeper of the Asian Games in Hangzhou,” the group statement reads.
After publication of the accounts, the stock loses 0,5% at 288,10 francs on the Zurich Stock Exchange.
