The Swatch Group Ltd. : Swatch Sees Further Growth In 2012 After Record Profits
02/07/2012| 01:45am US/Eastern
By John Revill
Swatch Group AG (UHR.VX), the world's largest watchmaker, Tuesday said it shrugged off the impact of the strong Swiss franc to report an 18% rise in net profit and said it expects growth to continue this year after a good start in January.
The company, whose brands range from high-end mechanical watches like Breguet and Blancpain to the eponymous plastic watches, is benefiting from booming demand particularly among Asian consumers--along with other Swiss watch makers like Compagnie Financiere Richemont SA (CFR.VX).
This helped it increase annual net profit to 1.27 billion Swiss francs ($1.38 billion) from CHF1.07 billion a year ago, beating analysts' expectations of CHF1.26 billion. Sales rose to CHF7.14 billion, the company said on January 10.
Looking ahead, Swatch said it's well prepared for the future "maintaining its clear and healthy long-term growth strategy, and expects growth to continue in 2012, although this is more and more challenging due to the high benchmark".
"We will also continue to make targeted investments in 2012 in our worldwide distribution network and in our production capacities in Switzerland across all segments, despite the strong Swiss franc," Swatch said in a statement.
Chief Executive Nick Hayek has been one of the most vocal company bosses calling for action to curb the rise of the currency, which almost reached parity with the euro last summer.
Speaking in January, he described the currency situation as "catastrophic" and the biggest challenge facing the company.
Swatch said it would raise its dividend to CHF5.75 per bearer share from CHF5.0 in 2010, and lift its registered share dividend to CHF1.15 from CHF1.0.
-By Neil MacLucas and John Revill, Dow Jones Newswires; +41 43 443 8042 ; firstname.lastname@example.org