Swatch Shares Drop on 2018 Results

   By Pietro Lombardi 
 

Shares in Swatch Group AG (UHR.EB) lost ground Thursday after the company's 2018 results missed expectations.

The Swiss watchmaker's net income rose 15% to 867 million Swiss francs ($870.3 million), while revenue rose 6.1% to CHF8.48 billion.

At 0826 GMT shares in Swatch traded 7.6% lower at CHF280.50.

The Swiss company said business slowed in the last quarter.

"The month of December in particular was slow, due in part to the very high comparison basis," it said.

The weaker fourth quarter shouldn't surprise the market "given the parade of negative data points from Asia hard luxury players in recent months and the weakness in the Swiss watch export data," RBC Capital Markets said.

"That said, this set of numbers came in weaker than reduced expectations into this release and contrast with solid numbers" of some competitors, such as LVMH Moet Hennessy Louis Vuitton SE (MC.FR), RBC added.

Swatch proposed to increase its dividend by 6.7% to CHF8.00 per bearer share, while the proposed dividend per registered share is CHF1.60, up from CHF1.50 for the previous year.

The company said it forecasts healthy growth in 2019, "despite the strong comparison basis in the first half of 2018," adding that 2019 started with solid growth in January.

Write to Pietro Lombardi at [e-mail]

(END) Dow Jones Newswires

January 31, 2019 03:58 ET (08:58 GMT)

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