The Hour Glass posts 75% rise in H2 profit amid stronger demand for mechanical watches

LUXURY watch retailer The Hour Glass posted a net profit of S$92.1 million for its fiscal second half ended Mar 31, 2022.

This is 74.7 per cent higher than the S$52.8 million it made over the same period in the previous financial year.

Revenue for the period also increased 23.8 per cent to S$561 million, from S$453.1 million in the corresponding half-year period, the company disclosed in a bourse filing after market close on Thursday (May 26).

Earnings per share rose to 13.44 Singapore cents, from 7.49 cents in the year-ago period.

With the strong set of results, The Hour Glass has proposed a final dividend of 6 Singapore cents per ordinary share for the full 2022 financial year, up from 4 cents last year. The dividend is subject to approval of the company’s shareholders at the annual general meeting to be held on Jul 29.

In the filing, The Hour Glass said the set of results came on the back of an “accelerating momentum” in customer demand for mechanical watches. 

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The interest in watches had been “broadening and deepening” over the past few years, it noted, adding that the trend has reached new sets of younger, highly discerning watch enthusiasts and buyers.

Group managing director Michael Tay said: “The Hour Glass’ performance was boosted by a significantly broadened fascination in high-quality mechanical watches. 

“The interest we are experiencing among local clientele in each of the cities we are present in has become more pronounced and we believe this is likely to continue.”

For the next financial year, the group said it expects to remain profitable as it believes demand momentum will remain buoyant. It added that it will continue focusing on “organic development” throughout the Asia-Pacific region.

For the full year, profit jumped 87.6 per cent to S$154.7 million, from S$82.5 million in the previous year, while revenue reached S$1.03 billion, up 39.1 per cent from S$742.9 million the year before.

Meanwhile, gross margin improved to 32.7 per cent, compared to 29.2 per cent in the previous year. Demand across its network of 50 boutiques in the Asia-Pacific contributed to the performance, the group said, giving special mention to Australia and Malaysia.

The counter closed 4.4 per cent or S$0.10 lower at S$2.17 on Thursday.