Watches of Switzerland Group plc

FY2026 sales were GBP 1.828 billion, up 13% in constant currency and 11% at reported rates. Adjusted EBIT was GBP 155 million, up 6% in constant currency, and adjusted EBIT margin was 8.5%, down 60 basis points year over year. Adjusted EPS was GBP 0.452, up 9%, free cash flow was GBP 162 million, and ROCE was 18%. Statutory PBT was GBP 133 million, up 75% year over year. The U.S. grew 24%-25% in constant currency, the U.K. grew 5%, and e-commerce and pre-owned both grew 21%-22%. For FY2027, management guided to constant-currency revenue growth of 5%-10%, adjusted EBIT margin expansion of 40-80 basis points, and capex of GBP 60 million-GBP 70 million. The guidance assumes a 52-week year versus 53 weeks in FY2026 and confirmed showroom projects, and excludes uncommitted capex and acquisitions.

Brian Duffy framed FY2026 as a year of strong execution in a difficult backdrop, citing tariffs, gold price inflation, margin pressure, and ongoing U.K. consumer weakness. He emphasized that growth was broad-based across the business, especially in the U.S., pre-owned, Roberto Coin, e-commerce, and showroom investments. His tone on current trading was constructive but cautious: the first 10 weeks were ahead of plan, but he repeatedly noted the period is early and macro uncertainty remains.

Anders Romberg highlighted sales of GBP 1.828 billion, adjusted EBIT of GBP 155 million versus GBP 150 million a year earlier, adjusted EBIT margin of 8.5%, and adjusted EPS of GBP 0.452. He said net product margin fell 70 basis points because of adverse mix, brand margin pressure from U.S. tariffs, and higher gold prices, while the EBIT margin was also affected by a one-off GBP 3.5 million debt write-off in Roberto Coin. He noted free cash flow of GBP 162 million, cash conversion of 80%, net debt of GBP 57 million, leverage of 0.3x, and GBP 39 million spent on acquisitions, plus GBP 14 million spent on the share buyback during FY2026. For FY2027, he said guidance assumes supply visibility for key brands and confirmed showroom projects, with revenue growth of 5%-10%, margin expansion of 40-80 bps, and capex of GBP 60 million-GBP 70 million.

Analysts focused on near-term trading, U.S. dollar sensitivity, Rolex certified pre-owned progress, margin bridge for FY2027, the Saks-related write-off, Roberto Coin customer churn and supply, and brand/pricing momentum. Management said current trading is encouraging and slightly ahead of internal assumptions, but too early to change guidance; they also gave a sensitivity of about $30 million in sales and $4.5 million in EBIT for a $0.05 move in the dollar. On CPO, they said it is now over 8% of business, is being rolled out further, and gives them a scale advantage. They confirmed the Saks debtor write-off was GBP 3.5 million and included in adjusted EBIT, and said Roberto Coin has seen no customer churn and no supply issues.