(Alliance News) - Watches of Switzerland Group PLC on Thursday said it delivered a strong performance in the first half of the 2021 financial year against significant headwinds.
The British retailer of Swiss watches reported a swing to a pretax profit of GBP36.2 million for the six months ended October 25, compared to a GBP9.0 million loss the year prior.
Watches of Switzerland said its revenue for the period was GBP414.3 million, a 3.4% decrease from GBP428.7 million in 2019. This was due to stores closing for four weeks during the England lockdown and for shorter periods in Wales and Scotland, resulting in the UK store network being open for just 44% of its potential trading hours.
Chief Executive Brian Duffy said: "Despite significant headwinds throughout the period, we achieved a good sales performance with domestic customers offsetting lower tourist and airport sales in the UK, and elevated momentum in the US. With positive cash management, we have further reduced debt and have a significant liquidity headroom."
Looking ahead, Watches of Switzerland said it intends to repay furlough support received from the UK government, subject to no significant disruptions, and does not foresee Brexit having any material impact on its supply chain.
The company reported in October it was upgrading its financial 2021 revenue guidance to between GBP880.0 million and GBP910.0 million from previously guided range of GBP840.0 million to GBP860.0 million. It also upgraded its forecast for earnings before interest, tax, depreciation, and amortisation margin, now expecting a 1.0% to 1.5% rise year-on-year. It had previously been expecting this to be flat.
Watches of Switzerland reported Fabrice Nottin, Apollo Management International LLP's representative non-executive director, and Michele Raba, Apollo's board observer, have both stepped down with immediate effect. Apollo does not intend to appoint replacements, Watches of Switzerland said.
Apollo holds a 28% stake in Watches of Switzerland, having sold a 14% stake back in September.
Shares in Watches of Switzerland were up 3.5% at 540.00 pence in London on Thursday.
By Zoe Wickens; zoewickens@alliancenews.com
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