Watches of Switzerland Group plc. (WOSGF) H1 2024 Earnings Call Transcript

Watches of Switzerland Group plc. (OTCPK:WOSGF) H1 2024 Earnings Conference Call December 7, 2023 4:00 AM ET

Company Participants

Brian Duffy – CEO

Anders Romberg – CFO

Conference Call Participants

Melania Grippo – BNP Paribas

John Corks – Kepler

Adrien Duverger – Goldman Sachs

Brian Duffy

Good morning, everyone. Thank you for joining our webcasting call on the results of the Watches of Switzerland group for the Half Year to October’23. We have previously reported Q2 and H1 revenues to the market and we have presented the status of the Company and plans for our group with our LRP and therefore this presentation is reasonably concise, allowing more time for Q&A.

Our agenda this morning, I’ll present an overview of the group’s performance, Anders Romberg, our CFO, will then present the financials, then we will present a summary of our LRP headlines and numbers together, following which we’ll open the lines for Q&A. We are very pleased with our strong first half performance in the UK and the US, despite a challenging economic environment.

Group revenue growth of 2% at constant currency, flat at reported rates; strong US revenue growth of 11% at constant currency. Adjusted EBITDA of GBP94 million was 8% down at constant currency, 10 at reported rates. EBITDA of GBP73 million, achieving a margin of 9.6%, which was down 170 bps versus last year, due predominantly to a reduction in net margin from product mix and interest-free credit costs.

Net cash of GBP60 million, compared to GBP26 million borrowing at half one last year, with cash conversion of 60%, 700 bps higher than last year. We’ve now completed the acquisition of the luxury showrooms from Ernest Jones. These stores had a combined LTM sales of around GBP45 million.

We have successfully launched Rolex certified pre-owned in both

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