At the start of today's trading session, shares of Watches of Switzerland (WOSG.UK) are up nearly 4% as the company shared its Q1 FY2024 results with investors and reiterated its earnings guidance for the year, on the back of continued demand for luxury jewellery and watches.
As Brian Duffy, the company's chief executive officer, added, the Q1 FY2024 results were in line with the company's expectations, which came in tandem with very good sales momentum in the US. For the future, the company has high hopes for the launched Rolex Certified Pre-Owned programme, where the company certifies the authenticity of pre-owned Rolex watches, which have been hugely popular on the secondary market for many years. The Watches of Switzerland group has already introduced this mechanism in the US, with the UK to follow as early as 30 September. The results from the US subsidiary are satisfactory, the director added.
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Open account Try demo Download mobile app Download mobile appDuring this autumn, the company is also expected to present its plans for long-term expansion, reaching up to the 2028 financial year.
Company results for the first quarter of the 2024 financial year by business sector and geographical area. Despite the positive outlook for the future, the sales results themselves show a year-on-year decline. Source: Watches of Switzerland
What does the company expect in the future? - Guidance
The company has maintained its current guidance when it comes to the entire fiscal year 2024:
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Revenue - (£1.65bn, £1.70bn) +8% - 11% y/y at constant currency
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Adjusted EBIT margin - at the level of FY2023 (around 11.59%), a risk factor here could be the general price declines of luxury watches on the secondary market.
Source: Bloomberg
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Demand for luxury watches remains very strong, with demand outstripping supply
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Forecasts assume no impact from improving consumer sentiment this year
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The Group plans to open nearly 20 new stores in the UK, US and Europe this year
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The Group is exposed to changes in the GBP/USD exchange rate when converting the results of its US operations into sterling. The actual average exchange rate for the 2023 financial year was 1.20.
WOSG.UK share price chart, D1 interval. Source: xStation 5
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