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Bloomberg
Swatch Group fell to the lowest in a decade as Switzerland’s largest watchmaker faces a triple whammy from Hong Kong protests, competition with smartwatches and viral outbreak in China. Operating profit fell for the first time in three years, dropping 11% to $1.1 billion. Analysts expected 1.09 billion francs.
The shares fell as much as 4.1% on January 30. Swatch aims to boost sales 5% to 6% this year at constant currency, CEO Nick Hayek said.
Swatch is feeling the pinch of weaker demand for lower-priced timepieces amid competition from the Apple Watch and fitness bands. Last year, Switzerland exported fewer watches in any year since 1984 as demand collapsed in the lower end of the market. Swatch depends on high-volume sales from brands like Tissot to have the scale necessary to keep its costs in check.
“We expect growth in China this year, and won’t change now our forecasts because of the coronavirus,†Hayek said.