I imagine rolex sports models are a relatively small proportion of their business so doubt it impacts them too much. It is still impressive growth nonetheless.
There have been several threads lately on the situation with AD’s particularly the lack of supply of Rolex sports models and resulting grey prices. So I thought this was quiet a topical article on the telegraph today.
“Britain’s biggest seller of Rolex and Cartier watches trebled profits in its maiden results as customers remain unfazed by Brexit blues.**
Watches of Switzerland, which listed on the London Stock Exchange less than two months ago, has 128 stores, including Goldsmiths, Mappin & Webb and Mayors*in Britain and the US.*
Pre-tax profits jumped 180pc to £20m for the year to July 17, while revenues increased from £631m to £773m. Like-for-like sales in the UK rose 10pc.*“
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I imagine rolex sports models are a relatively small proportion of their business so doubt it impacts them too much. It is still impressive growth nonetheless.
I’m not sure how there sales break down by brand but they are clearly selling lots of watches and benefitting from the demand in luxury watches.
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It's all those people buying two tone date justs at full price and every other brand under the sun to be put on the magical list for a GMT or Daytona.
Oh, and tax free from tourism helps too
It’s a pre-tax profit of less than three-per-cent of turnover. Surprisingly small real margins.
Last edited by paskinner; 17th July 2019 at 15:19.
Their gross margins are nearly 40%. They have high store costs and have been opening expensive new stores, but expect store costs to fall in the future. In addition previously their debt financing was expensive but they have moved to reduce the cost of that.
Their adjusted EBITDA of £69m/17.6% doesn’t look bad. Basically if the market holds up for the next few years and they maintain tight operational control, they seem quite well set to me anyway. Someone who understands Retail properly may have a more informed view.
A greater proportion of their sales are luxury watches as well, and they are moving more into digital. They have also spent less on sales incentives (presumably that means less room for discounts/freebies).
Big company selling expensive baubles profit shock!
Or maybe not?
Don’t think I’d want to be a shareholder on those figures - very small margins if (when) there’s a downturn in that market.
Weak pound£ is probably the sole underlying factor in this growth, with I would expect the rising sales driven by tourists.
When the manufacturers readjustment of RRP to counter the currency fluctuations happens post Brexit or sooner if the value of the pound keeps diving, then those big profits headlines may be a distant memory.
Looks like my new DJ made ALL the difference, bubbly at the shareholder's meeting!
The flagship store at Regents Street is a place of wonder, three floors, every brand except AP as they can only have one and PP got it!
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