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Watches of Switzerland warns of poor UK trading

Luxury watches seller Watches of Switzerland (LSE: WOSG) on Thursday warned of “more challenging” consumer environment in the UK, although it continues to eye growth opportunities in the US. The retailer posted a 0.5% year-on-year …

Luxury watches seller Watches of Switzerland (LSE: WOSG) on Thursday warned of “more challenging” consumer environment in the UK, although it continues to eye growth opportunities in the US.

The retailer posted a 0.5% year-on-year decline in revenue to £761.4 million for the six months to October 29. Pre-tax profit dropped 20% to £66.5 million. However, Watches of Switzerland saw 11% revenue growth in its key US market, now accounting for 43% of total group revenue.

Watches of Switzerland shares were trading flat at 659.00p by 10:25 GMT.

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While the company left its full-year guidance unchanged, expecting 8-11% constant currency revenue growth, its share price has struggled to recover since plunging over 20% in August. The slump followed rival retailer Rolex’s decision to purchase Swiss group Bucherer, sparking fears over product allocation.

Chief Executive Brian Duffy said the company remains “confident” in its long-term plan to double sales and profit by 2028. But with its shares down 21% year-to-date, the UK trading environment poses a near-term headwind.

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