Richemont’s Piaget Aims to Lift Sales via Record-Thin Timepiece

Piaget is confident new timepieces including the $53,000 record-breaking Altiplano Skeleton 1200S will help lift sales this year amid concerns of a recession in Europe and slowing demand in Asia.

The Swiss watchmaker will introduce the new model, which features the world’s thinnest automatic skeleton movement and watchcase, at next week’s SIHH watch fair in Geneva, Chief Executive Officer Philippe Leopold-Metzger said in a phone interview yesterday. Also on show will be the Gouverneur range in white and rose gold, he said, declining to provide more details.

“Newness is something important in our business,” said Leopold-Metzger. The executive, who has forecast revenue growth of more than 10 percent in the current fiscal year, wouldn’t comment on sales in December ahead of a quarterly update by Piaget’s owner Cie. Financiere Richemont SA (CFR) on Jan. 16. “It’s a good year and we are looking forward again to what will be a fairly good year in 2012,” he said.

Watch and jewelry sales will continue to outperform other luxury goods in 2012, according to CA Cheuvreux analyst Thomas Mesmin. Sales at Richemont’s specialist watch unit, which includes Piaget, will rise 14 percent on a like-for-like basis in the year ending March 2013, faster than the sector’s overall growth, Mesmin estimates.

‘Robust Chinese Demand’

A skeleton movement means the case has openings that reveal the inner workings of the watch.

Richemont’s watchmaking brands “look set to continue to benefit from robust Chinese demand both from inside and outside greater China,” Mesmin wrote last month.

While mainland Chinese customers continue to drive sales in Asia, Piaget’s growth in the region may slow this year because of a high basis of comparison, Leopold-Metzger said. Korean sales are rising “very strongly” and Japan “is back on the growth trend,” he said. Piaget gets more than half of revenue from Asian customers, the CEO said. The Middle East and the Americas are other “bright spots,” he said.

Piaget plans to add about 10 to 15 boutiques a year to its current total of 79, according to the CEO. The 138-year-old company expects to hire more staff in stores and manufacturing, he said, declining to say how much. “Like every other brand, we would have sold more if we had bigger production,” he said.

Demand has been “pretty steady” across the range, while ultra-slim watches, in particular the Altiplano line, which starts at 18,800 francs ($19,780), are performing “very well,” Leopold-Metzger said.

After the Swiss franc appreciated against the euro in 2011, “we are looking more at the situation being steady” in 2012, he said. “We don’t expect any major disturbances on that side.” Still, Piaget, which makes its timepieces in Switzerland, may lift prices, the executive said.

To contact the reporter on this story: Andrew Roberts in Paris at aroberts36@bloomberg.net;

To contact the editor responsible for this story: Sara Marley at smarley1@bloomberg.net

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