This year’s Chinese New Year holiday was a non-event for luxury watch sales, The Watches of Switzerland Group CEO Brian Duffy told WatchPro today in a call to discuss its 3rd quarter financial results.
The hit from Chinese not traveling would have been worse had it happened a year ago as the group had already been weaning itself off too much reliance on sales to Chinese consumers before the current outbreak of Coronavirus, and has a stated ambition of increasing sales to domestic customers in the United States and the UK.
For the full 2019 financial year, which ended in April last year, sales to Chinese clients amounted to 10% of group turnover.
In the first nine months of the current financial year, that figure is down to 7.8%, Mr Duffy revealed.
He says that sales to Chinese are “insignificant” in the United States, although there is significant domestic tourism to its Mayors stores in Florida and its boutiques in Las Vegas. Its New York showrooms are located away from tourists hot spots like 5th Avenue and Madison.
In its most recent quarterly results that covers the 2019 holiday season and new year period up to January 31, the group says that sales rose by 32.3% in the United States and 7% in the UK in the 13 weeks to January 26, adding up to worldwide revenue of £258 million, up 13.4% at constant currency.
Commentary with the financial results spoke about supply of luxury watches remaining the most pressing issue for the group, but a broadening base of successful brands other than Rolex, is helping to mitigate for an 18-month-long drought for the most in-demand watches.
Asked whether the Coronavirus crisis in China could lead to more watches becoming available in Western markets like the United States and UK, he replied: “that would be a logical conclusion,” without elaborating.