Swatch Group ups availability of Harry Winston

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Group’s watch and jewellery segment up 9.1% in the first half of 2013.

Swatch Group has released its report for the first six months of 2013, outlining its efforts to increase the availability of Harry Winston jewellery.

The Swiss group’s sales were up 8.7% in the first six months of the year, totalling CHF4.2 billion (£2.9bn). It says it has sustained growth in all regions, with "a great deal of investment has been ploughed into the marketing activities of all of the brands", including investment relating to the redesign of booths for BaselWorld.

Swatch Group sealed its takeover of Harry Winston’s jewellery and watch arm earlier this year. Its production is this sector was up 9.1% in H1, increased to ensure that Harry Winston clientele "[had] access to the best selection of jewellery as well as to increase its availability".

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The report reads: "The acquisition of the Harry Winston brand did more than simply round off the group’s already broad brand portfolio; it also expanded the high jewellery segment, along with the segment’s value chain from production up to and including the retail network."

Swatch Group said that in the first few months following the acquisition of Harry Winston’s watch and jewellery arm all debts were settled, the equity capital base expanded and the brand’s inventory was also immediately increased in order to have product ready for clients when needed.

The company also notably invested in a 101.73 carat diamond, now dubbed the Winston Legacy, purchasing the stone for US$26.7 million (£17.4m) at auction, something Swatch Group says "reconfirms" Harry Winston’s place as a leading high jewellery brand.

"The Harry Winston brand also has an extremely large and almost untapped potential in the watch sector, which the group now aims to expand further using its experience around the world. The necessary funds will also be invested into this activity," said the report.

Swatch Group, which now operated 20 brands, added that the integration of Harry Winston will "only really become noticeable in the second half of 2013".

Further results in the H1 report show Swatch Group’s operating profit totalled CHF910 million (£632m) in the first six months of the year, with an operating margin of 22.7%, despite a high marketing spend, new production methods and the integration of Harry Winston.

The group’s income increased by 6.1% compared to the first half of 2012 to CHF768 million (£533m), with a 19.2% return on net sales.

Looking ahead Swatch Group said its outlook for the second half of the year remains positive, with a strong second half-year is expected. It said that the continued integration of the Harry Winston brand will also make a significant contribution to H2, again touching on the brand’s "huge, almost untapped market potential in the high jewellery and watches activities".
 

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