Investing.com -- Shares in Watches Of Switzerland (LON:WOSG) climbed on Thursday after the seller of brands like Patek Philippe and Cartier unveil a full-year outlook that pointed to an improvement in revenues and profit margin.
Like other luxury firms, Watches of Switzerland has been faced with recent headwinds, including inflation-linked weakness in consumer demand and sluggish performance in the key Chinese market.
The group acknowledged that trading conditions in its 2024 fiscal year were "more challenging," although it remained "cautiously optimistic" about its prospects for its current 12-month period.
"The industry as a whole is being more conservative on production given the current volatility in the market, which we believe is a responsible approach to the long-term stability of the luxury watch market," Watches of Switzerland said in a statement.
Annual revenue is now seen at between 1.67 billion pounds to 1.73 billion pounds, representing growth of 9% to 12% at constant currencies.
Expansion of 0.2 to 0.6 percentage points in adjusted earnings before interest and tax margin is also projected. Analysts at RBC Capital Markets said the guidance implies a mid-point pre-tax profit outcome of 153 million pounds and margin of 9.1%, above consensus estimates.
The analysts added that Watches of Switzerland's recent $130 million acquisition of U.S. jewellery brand Roberto Coin will help boost the company's "pipeline of new stores."