Watch brand Frederique Constant expects 25% drop in sales this year
09/10/2020 15:16
ZURICH, Oct 9 (Reuters) - Swiss watch brand Frederique
Constant, owned by Japan's Citizen Watch Co 7762.T , is hoping
to limit the fall in sales to 25% this year as September
business was almost back to normal, its chief executive told
Reuters.
"That's what we're aiming for," Niels Eggerding said in an
interview in Zurich this week.
Swiss watchmakers have been severely hit by the COVID-19
pandemic as stores stayed closed for weeks during lockdowns.
Swatch Group's UHR.S sales almost halved in the first six
months of 2020 and Richemont CFR.S posted a similar decline
for the quarter to June. urn:newsml:reuters.com:*:nL5N2EL0M3 urn:newsml:reuters.com:*:nL5N2EN10Z
The two industry heavyweights have not released trading
updates since, but recent industry comments and watch export
data are also pointing to a timid recovery. urn:newsml:reuters.com:*:nL8N2FQ2DM
urn:newsml:reuters.com:*:nFWN2FM05U
"April was down 80%, May still around -50%, June almost back
to normal, July and August down again, but September almost back
to normal," Eggerding said, adding the UK market was doing well
while China remained difficult for the Geneva-based brand that
sold 160,000 watches last year.
He said, however, that the company, acquired by Citizen in
2016, had cut some jobs and many employees were still working
shorter hours under a Swiss state-backed programme to avoid
layoffs.
Frederique Constant and sister brand Alpina were among the
first Swiss watchmakers to embrace smartwatches five years ago,
while many peers ignored this competition that has since taken a
heavy toll on Swiss watch sales in the entry-price segment.
Frederique Constant's new Vitality Gents smartwatch costs
just under 1,000 Swiss francs ($1,096), while prices for the
latest Apple Watch on Apple's AAPL.O website start at 419
francs. Smartwatch sales currently represent about 10% of
Frederique Constant's sales.
($1 = 0.9122 Swiss francs)
(Reporting by Silke Koltrowitz; editing by Emelia
Sithole-Matarise)
((silke.koltrowitz@thomsonreuters.com; +41 41 528 3638;))