Swatch : Key Figures 2022 Download

PRESS RELEASE | AD HOC

Biel / Bienne, 24 January 2023

Ad hoc announcement pursuant to Art. 53 of the Listing Rules

SWATCH GROUP: Key Figures 2022

• Net sales of CHF 7 499 million, +4.6% to the previous year at constant exchange rates, or +2.5% at current rates.
• Sales growth of 25% in local currencies in all regions, with the exception of China, where Covid lockdowns resulted in sales shortfalls of over CHF 700 million.
• The MoonSwatch is a best seller, with over 1 000 000 watches sold. Ongoing high demand, including in January, in the approximately 180 stores which exclusively offer the MoonSwatch.
• Operating profit of CHF 1 158 million (previous year: CHF 1 021 million).
  Operating margin of 15.4% (previous year: 14.0%).
• Net income of CHF 823 million (previous year: CHF 774 million).
  Net margin of 11.0% (previous year: 10.6%).
• Operating cash flow of CHF 724 million (previous year: CHF 1 298 million); lower versus previous year, mainly due to precautionary increase in safety stock.
  Free cash flow1) of CHF 342 million (previous year: CHF 1 033 million).
• High net liquidity2) of CHF 2 540 million (previous year: CHF 2 558 million).
• At its next meeting, the Board of Directors will decide on the dividend proposal to the Annual General Meeting.
• In view of the strong position of the Group brands in all segments worldwide and the robust numbers in January for Mainland China, the Group aims to achieve a record year in 2023.

1. Cash flow from operating activities minus cash flow from investing activities (without financial assets and securities)
2. Cash and cash equivalents as well as financial assets, securities and derivative financial instruments minus current financial debts and derivative financial liabilities

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Press release 24 January 2023

KEY FIGURES 2022

Group Key Figures

	(CHF million)	2022	2021
	Net sales				7 313
		7 499
	Operating result				1 021
		1 158
	- In % of net sales		15.4%		14.0%
	Net result				774
		823
	- In % of net sales		11.0%		10.6%
	Equity				11 605
		12 051
	- As % of balance sheet total		86.7%		84.8%

Unaudited figures

Highlights of the financial year 2022

Change in %

at constant currency

rateseffect

4.6%-2.1%

Total

2.5%

13.4%

6.3%

3.8%

Watches & Jewelry

At constant exchange rates, Group net sales were 4.6% above the previous year. The negative currency impact was CHF 151 million or -2.1%. The Watches & Jewelry segment (including Production) reported an operating margin of 17.2% (previous year: 15.9%).

Consistent double-digit sales growth in Europe, America, the Middle East, and most of the Asian markets was severely dampened by the significant decline in sales in China. Year on year, the sales shortfall in this region amounted to more than CHF 700 million. The fourth quarter was particularly affected. First the lockdowns, and then the massive Covid wave, after the measures were lifted, led to shortfalls of over 30% in this quarter. The decline in the month of December alone was around minus 50%. January shows growth again with sales which will exceed the strong corresponding month in the previous year.

Retail business reported double-digit growth, not only for the Swatch brand, but also in particular for the Harry Winston, Breguet and Omega brands. The Group continues to invest very selectively in new retail stores. At the end of 2022, a building was acquired at a top business location on the P.C. Hooftstraat in Amsterdam.

Demand for the 11 Bioceramic MoonSwatch models also remains unbroken high nine months after their launch, and queues in front of Swatch stores are still the order of the day. Despite an additional 70 points of sale and greatly increased production, daily demand still far exceeds available product. The MoonSwatch is popular with an extremely broad spectrum of customers of all ages and origins. In the wake of the MoonSwatch hype, the entire Omega Speedmaster collection, for example, the Moonwatch models, also profited from greatly increased interest.

Production

The production sector reported significantly higher sales and improved margins than in the previous year. Difficulties in procuring certain raw materials and components hindered an even better result and led to delivery delays, despite increased safety stock. Order books at the end of 2022 were 24% above the previous year.

Electronic Systems

Products of the highly specialized companies in the segment continued to be in extraordinarily high demand. This was the case for extremely low power consumption semiconductors from EM Microelectronic-Marin, as well as high-tech products from MicroCrystal for market leaders for mobile devices and the automotive and medical industry. Sales for the segment, to which battery producer Renata and timekeeper Swiss Timing also belong, were CHF 371 million or 18.2% above the previous year. Operating profit was CHF 47 million, corresponding to a margin of 12.7% (previous year: CHF 27 million or 8.6%).

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Press release 24 January 2023

KEY FIGURES 2022

Inventories

In view of potential energy shortages and possible delivery bottlenecks, the Group decided to massively increase safety stock where feasible. This measure will also pay off, considering higher demand in China after its zero-Covidstrategy exit. The major portion of the CHF 484 million or 7.6% higher inventories was in the categories of raw materials, work in progress, and semi-finished goods.

Research and development

Intensive research and development activities in the year under review led to 209 new patent applications (previous year: 202).

Personnel

The number of employees increased in comparison with the previous year by 617 or 2.0% to 32 061 persons.

Outlook 2023

Group Management anticipates strong sales growth in 2023 in all regions and segments. After the end of Covid measures, consumption quickly recovered, not only in China, but also in the surrounding markets of Hong Kong SAR and Macau. In addition, lifting of travel restrictions in China will revitalize sales in tourist destinations. The sales growth in January in China reinforces the Group's expectation to aim for a record year in 2023.

Tentative next publications / events:

16.03.2023	Publication of the annual report and the sustainability report 2022
10.05.2023	Press conference
Annual General Meeting
28.07.2023	Publication of 2023 half-year results
Original:	German
Translations:	English, French and Italian

CONTACTS

Investors

Felix Knecht, Investor Relations Officer Phone: [phone]

The Swatch Group Ltd, Biel/Bienne (Switzerland) E-mail: www.swatchgroup.com/contactus

Media

Bastien Buss, Corporate Communications Phone: [phone]

The Swatch Group Ltd, Biel/Bienne (Switzerland) E-mail: www.swatchgroup.com/contactus

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Press release 24 January 2023

KEY FIGURES 2022

Consolidated Income Statement

	2022		2021
	CHF million	%	CHF million
Net sales	7 499	100.0	7 313
Other operating income	244	3.2	281
Changes in inventories	538	7.2	19
Material purchases	-1 847	-24.6	-1 524
Personnel expense	-2 363	-31.5	-2 206
Depreciation and impairment on property, plant and equipment	-366	-4.9	-396
Amortization and impairment on intangible assets	-41	-0.6	-42
Other operating expenses	-2 506	-33.4	-2 424
Operating result	1 158	15.4	1 021
Other financial income and expense	-38	-0.5	4
Interest expense	-3	-0.0	-5
Share of result from associates and joint ventures	-21	-0.3	-9
Ordinary result	1 096	14.6	1 011
Non-operating result	0	0.0	0
Result before income taxes	1 096	14.6	1 011
Income taxes	-273	-3.6	-237
Net result	823	11.0	774

	Attributable to shareholders of The Swatch Group Ltd		807				765
	Attributable to non-controlling interests		16				9
	Earnings per share in CHF
	Registered shares
	Basic earnings per share		3.11				2.96
	Diluted earnings per share		3.11				2.95
	Bearer shares
	Basic earnings per share		15.57				14.78
	Diluted earnings per share		15.56				14.77

Unaudited figures

%

100.0

3.8

0.3

-20.8

-30.2

-5.4

-0.6

-33.1

14.0

0.0

-0.1

-0.1

13.8

0.0

13.8

-3.2

10.6

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Press release 24 January 2023

KEY FIGURES 2022

Consolidated Balance Sheet

Assets

Current assets

Cash and cash equivalents

Financial assets, securities and derivative financial instruments

Trade receivables

Other current assets

Inventories

Prepayments and accrued income

Total current assets

Non-current assets

Property, plant and equipment

Intangible assets

Investments in associates and joint ventures

Other non-current assets

Deferred tax assets

Total non-current assets

Total assets

Unaudited figures

	31.12.2022
	CHF million		%
	2 176		15.6
	372			2.7
	663			4.8
	103			0.7
	6 873			49.5
	206			1.5
	10 393		74.8
	2 706		19.5
	146			1.1
	19			0.1
	181			1.3
	448			3.2
	3 500			25.2
	13 893		100.0

31.12.2021 CHF million

1 979

677

710

136

6 389

216

10 107

2 771

144

21

186

449

3 571

13 678

%

14.5

4.9

5.2

1.0

46.7

1.6

73.9

20.3

1.0

0.1

1.4

3.3

26.1

100.0

5