Watches Of Switzerland Group Stock

Good morning, everyone. Thank you for joining our presentation. We will be reasonably brief this morning, focusing on fiscal year '26 results ahead of hosting a more in-depth presentation on our growth strategies this afternoon. You'll be hearing firstly from me, Brian Duffy, Group CEO. I'll be taking you through some highlights for the year and performance against our growth pillars. I'll then hand over to Anders Romberg, our Group CFO, who will take you through the numbers in more detail before we open up, as usual, for your questions.

Fiscal year '26 was a year of strong execution against what was a complex and changeable operating backdrop. The growth our teams managed to deliver while navigating headwinds from tariffs, gold pricing, margin changes and ongoing consumer pressure in the U.K. is a testament to their drive and capabilities. So our top line numbers, sales for the year of GBP 1.828 billion, up 13% on last year in constant currency. The U.S. was plus 24% in constant currency, which saw it become our largest revenue and profits market, and the U.K. was plus 5% on last year.

Encouragingly, we saw an improving trend over the course of the year with H2 at plus 17% constant currency ahead of the plus 10% delivered in H1. Adjusted EBIT grew 6% in constant currency to GBP 155 million and statutory PBT of GBP 133 million was up an impressive 75% year-on-year.

Turning to our growth drivers. We will talk about these focus areas in more detail this afternoon. But for now, I'd like to share some of the highlights from fiscal '26. We invested GBP 66 million into our showroom estate during the year, completing 13 major projects. We were also very pleased to complete the acquisition of Deutsch & Deutsch in January. This is a fantastic addition to our business, showrooms, which have a well-established presence and client relationships in 4 Texas locations as well as long-standing partnerships with leading watch and jewelry brands.

Pre-owned continued to perform well, up 22% year-on-year with good growth in both the U.K. and the U.S. In luxury branded jewelry, Roberto Coin performed very well at plus 20%. We saw sales through our Mayors boutiques more than double following the upgraded shop-in-shop installations. We've had a good success with our launch of lab-grown diamonds. The product is trading really well in the U.K., and we have now launched in the U.S.

E-commerce also had a good year in both markets with growth outpacing the overall group at plus 21%. We launched a new upgraded Hodinkee app during the year with a shop option through to Watches of Switzerland. Ben Clymer, Founder of Hodinkee, will also be joining us this afternoon to present the Hodinkee story and growth strategy.

As I mentioned earlier, looking at the geographic split of our sales, the U.S. surpassed the U.K. in fiscal year '26 as our largest market by revenue, reaching 51% of group share. Our group sales remain very much domestic driven, 95% in fiscal year '26 with very little international business since VAT-free shopping was removed in the U.K. following Brexit implementation in 2021. So altogether, FY '26 was a record year for our group. Our revenue CAGR between fiscal year '15 and '26 is 15.5%, and we saw adjusted EBIT increase despite the volatility in the year. Our balance sheet remains healthy. The net debt reduced to GBP 56 million during the year, and our ROCE was a robust 18%.

Focusing on highlights from the U.S. market, fiscal year '26 constant currency growth increased to 24% with an acceleration during H2 to 27%. Growth was broad-based, led by strong underlying demand, outperformance of Roberto Coin, e-com and pre-owned, our showroom investments and contribution from the acquisition of Deutsch & Deutsch. We're pleased to have carried this good momentum into the new financial year.

Key projects for the year included a new Watches of Switzerland in Minneapolis, 2 relocations in Georgia and Florida as well as 3 Roberto Coin mono-brand boutiques. We have also developed our growth strategies and plans for Roberto Coin and Hodinkee, which we will discuss further this afternoon. A bit more detail on our acquisition of Deutsch & Deutsch. We have adopted a new acquisition model here, which sees the former owners, the Deutsch family retain a 12% ownership, something we believe works well from all perspectives. We are pleased to have Tad and Aladar Deutsch remaining in the leadership of the business. They are great operators and bring fantastic local knowledge of the market and long-standing client relationships. The integration has been very positive, and we are delighted to have added 60 Deutsch & Deutsch colleagues to our team.

Turning to the U.K. Growth in fiscal year '26 was solid at plus 5%, which was a good result against a somewhat subdued market backdrop. Trading improved over the course of the year, and we believe the market is now showing encouraging signs of improvement, which is great to see. We completed 7 key projects during the year. Highlights include the expansion and refurbishment of Mappin & Webb in Birmingham and refurbishment of the first ever Rolex agency in the U.K., Northern Goldsmiths in Newcastle.

We had our first full year of trading at Rolex Old Bond Street, having opened at the end of fiscal year '25. The showroom performed brilliantly ahead of plan with strong client feedback, including a very high NPS of 93. We have taken the learnings from this great client experience and included these learnings in all of our training programs. With that, I'll hand over to Anders to talk through the financials in more detail.

Thank you, Brian. FY '26 delivered a record year of sales and strong momentum in the U.S. market and a robust U.K. performance. Sales came in at GBP 1.828 billion or plus 13% at constant currency versus last year. The sales growth was driven by the U.S. market with growth of 25% in constant currency. Our adjusted EBIT came in at GBP 155 million versus GBP 150 million in FY '25 or plus 6% in constant currency, with adjusted EBIT margin of 8.5%, down 60 basis points versus prior year. Our free cash flow was GBP 162 million, and return on capital employed was 18%.

On to the income statement. This is presented on a pre-IFRS 16 basis and excludes exceptional items. The reconciliations to the statutory numbers are included in the RNS. Net sales was up 13% versus last year in constant currency or 11% at reported rates, driven by strong U.S. performance. Net product margin was 70 basis points down versus last year, reflecting adverse product mix and a reduction in brand margins due to U.S. tariffs and significant increases in gold prices.

Our adjusted EBIT was GBP 155 million or plus 6% compared to last year at constant currency or 3% in reported. This gave an adjusted EBIT margin of 8.5%, down 60 basis points to last year due to the net margin decline, as just mentioned, and a one-off debt write-off in Roberto Coin. This was partially offset by leveraging showroom costs and overheads.

The effective tax rate was 26.7%, a reduction on last year, driven by a one-off tax credit on Roberto Coin. Adjusted EPS came in at 45.2p, an increase of 9%.

Looking at the breakdown of sales, the U.S. was the biggest growth driver. U.S. retail was up 25% in constant currency with robust demand across brands and categories, supported by the expansion of our showroom network. We're pleased with the performance of Roberto Coin wholesale with sales growth of 22% in constant currency. There's been a positive market response to the new products and the advertising campaign launched at the start of the year.

Within our Mayors network, Roberto Coin sales more than doubled following upgraded shop-in-shop presentations. U.K. and Europe sales grew by 4% with 5% U.K. growth, excluding the closure of our European showrooms. Continued demand for luxury watches and improving momentum in luxury jewelry in the second half drove the growth. Across both markets, our e-com business continued to do well and grew by 21% in constant currency. Our pre-owned business grew by 22% in the year. Adjusted EBIT came in at GBP 155 million or plus 6% on last year at constant currency. Adjusted EBIT margin was 8.5%, which was 60 basis points down to prior year due to product margin rate decline, partially offset by leverage of fixed cost.

The U.S., including Roberto Coin wholesale, is the major growth area and 51% of group sales represents 62% of adjusted EBIT. U.S. retail had product margin contraction due to U.S. tariffs, but this was offset by leveraging on the cost base. The year was also impacted by investments behind our e-commerce business and Hodinkee. We expect these investments to start delivering benefits in FY '27 and beyond.

In the U.K., product margin was impacted by adverse product mix with limited leverage on the cost base. We focused on cost control and store profitability and made good progress during the year. Roberto Coin wholesale EBIT margin was impacted by one-off department store debtor write-off and the investment behind our marketing campaign with Dakota Johnson. Our balance sheet is strong. In the year, we spent GBP 39 million on acquisitions made up of our purchase of Deutsch & Deutsch and the final payment for Roberto Coin.

Continued capital investments in our estate to elevate the network and drive future growth remains a key component of our growth strategy. Inventory levels were up 2% with continued improvement in underlying stock turns. Average unit cost of stock increased in the year, reflecting increased gold prices and U.S. tariffs. Underlying inventory was flat year-on-year, and the increase came from the acquisitions of Deutsch & Deutsch. As a reminder, inventory is a very low-risk asset in our category.

We closed the year with a net debt position of GBP 57 million. Our net debt-to-EBITDA leverage came out at 0.3x. We continue to be highly cash generative. Our free cash flow for the year was GBP 162 million with a cash flow conversion of 80%. Last year was adversely impacted due to an increase in working capital as a result of change in payment terms from some of our key suppliers. In Q1, we completed the announced GBP 25 million share buyback program with GBP 14 million spent during FY '26. The full year net cash inflow was GBP 38 million.

Our guidance for FY '27 is based on a 52-week trading period versus 53 weeks in FY '26. It's also based on visibility of supply of key brands for the calendar year of '26. The guidance reflects confirmed showroom projects, but excludes uncommitted capital projects and acquisitions. So we're guiding towards revenue growth in constant currency of between 5% and 10%. We expect our adjusted EBIT margin percentage to expand by between 40 and 80 basis points, and our capital expenditure for the year will be between GBP 60 million and GBP 70 million. With that, I will now hand over to Brian for some final remarks.

Thanks, Anders. So I'll just summarize before we open up the Q&A. I'm extremely proud of the performance our teams delivered against what was a very complex and changeable operating backdrop. We made strong progress against each of our strategic pillars, and we look forward to sharing a bit more detail on those this afternoon. We started the new year well. Trading is encouraging in the first 10 weeks with continued strong momentum in the U.S. and in the U.K. looking to have returned to more normalized growth market conditions. We confirm our previous guidance.

Just before we open up to Q&A, if I could ask you to focus your questions on fiscal year '26 performance, and we will be more than happy to take questions on the broader strategy this afternoon. Operator, can we please open up to your questions.

Good afternoon, everyone, and thank you for joining. We've got Anders Romberg, our Group CFO, here; alongside David Hurley, our Deputy CEO. So please do feel free to add further questions into the text box on screen, but we'll begin working through the pre-submitted questions now. So first one we have here, what are the key drivers of revenue growth you expect over the next 12 to 24 months? And how confident are you in achieving them? How is the company managing demand for luxury watches amid changing consumer spending and economic uncertainty?

Well, we have our -- and I don't know how many of you -- I should say good afternoon, first of all, everybody. First of all, we have our 6 strategic pillars. And so they haven't changed in the last few years. So showroom investment, certified pre-owned e-commerce, luxury branded jewelry acquisitions and client experience. And I'll take each one of those just very, very quickly. We continue to have a strong pipeline of showroom investments. We've given the detail that we're going to be spending circa GBP 60 million to GBP 70 million on capital this year.

We've detailed out some of those projects, but it includes projects like a new boutique in Glasgow. We've announced that we're going to be opening up an expanded Rolex location in Terminal 5, that will open in 2027 in the U.S. We've got our Betteridge Greenwich store that's going to be opening this year. We're also opening up an expanded location just outside of Atlanta in a location called Avalon or Alpharetta. It's about 30 minutes outside of Atlanta. And another store that we acquired just outside of Philadelphia. Bernie Robbins will end up expanding this year as well with both Watches of Switzerland store and [ American Swiss ].

So we continue to have a strong pipeline of projects. And of course, with our brand partners given the length of time that these projects, we're talking 2 years and 3 years out on the different projects that we have. In terms of certified pre-owned, we're really delighted with our progress on certified pre-owned. It's gone from -- what was it 1.5% several years ago now to north of 8% of our total watch sales. We are targeting, we haven't put a time line on it for it to get close to 10%.

We have it in the majority of our showrooms today. We've still got 4 or 5 more showrooms in the U.K. where we're going to put Rolex Certified Pre-Owned in. And now with the acquisition of Deutsch & Deutsch in the U.S., we'll be adding it in there. But there are still more showrooms where we'll be able to add in the other brands that we do pre-owned with. And we're delighted with the fact that as we add in these new categories that we're also attracting new clientele, and we spoke on our Capital Markets Day about the fact that 77% of the clients that have purchased a pre-owned time piece from us over the last year are new to Watches of Switzerland.

So there's a lot more that we can do in that area. It is a different clientele, but it also requires different training and knowledge on the part of our teams. And so we're continuing to up our training and tweak our training for our showroom teams. And we continue to do more and more events around pre-owned as well. And of course, we as we get more and more well known for this, then we're also having clients come in and specifically asking us to source product, and that's something that we're able to do both in the U.K. and in the U.S. having acquired Analog Shift, we have that expertise.

E-commerce continues to be very strong, grew strongly last year. In the U.K., obviously, we've been at it for many years now, and it's close to circa 10% of our overall U.K. business. If you look at just the brands that we're able to retail online, it's closer to 20%. The U.S. is growing at a faster rate, but off a very low base today. It's slightly less than 2%. So we wanted to get closer to the U.K. number in terms of percentage of sales over a period of time, but we haven't put a time line on that. But we have put in the investments in FY '26 to support growing e-commerce in the U.S., both in terms of structure and systems. And of course, the acquisition of Hodinkee also helps with that as well.

Luxury branded jewelry, we've said that's been a focus for some time. Number one, that's led with our acquisition of Roberto Coin. We're 2 years in. We're even more delighted with the acquisition now and excited about the future for the potential of that brand than we were when we acquired it. We were working on that project for close to 18 months prior to announcing the acquisition. And the reason why we spoke to Roberto Coin and we're interested in acquiring them was, a, they already have scale. They're already very, very well known in the United States and the other territories that we taking the distribution rights.

And b, we were seeing that they were becoming more and more productive in our own stores. In point of fact, in case lines, they were sometimes doing more than shop-in-shops where we had some of our watch brands. So we've proven out in our own stores over the course of the last year that if we give it the appropriate space that it can be a very successful brand. I think we were up over 120% in the year in our own showroom network and over 180% from where we put in shop-in-shops.

So now we're taking that out to the other 400 points of distribution that we have across the U.S. with 17 store partners expanding prior to the end of January and then another 30 in progress prior to the end of the calendar year. And that's something that we'll be working on over the next few years. And then we have all the other areas that we can expand with Roberto Coin, both retail stores with 3 stores then, 3 more to go over the next 12 months. robertocoin.com, which is also part of our e-commerce strategy, the wholesale dot-coms, so the Saks and Neiman of the world and obviously, the international territories outside of the U.S., such as Canada, Caribbean and Mexico.

So -- and then in the rest of our jewelry business is very strong and is growing well, both in the U.K. where we've also introduced lab-grown diamonds, and that's attracting again as we add new categories that attracting new clients. And so that's been a great success in the U.K., and we've taken those learnings and we brought it to the U.S. as well. We only launched lab-grown diamonds in the U.S. a few weeks ago, but it's off to a strong start, and we see a lot of potential there.

Acquisitions, obviously, the last acquisition we've done is Deutsch & Deutsch. We had 1 of the 2 brothers, Tad present at our Capital Markets Day. We're delighted with the acquisition as our Deutsch & Deutsch. And again, we see a lot of potential in terms of -- and I think we've got a proven track record at this stage in terms of acquiring the business and over a period of time, investing in and expanding that business. And so they're close to their clients and their pillars of their community. They'll concentrate in the front-of-house activities, and we'll take a lot of the back-of-house activities of them. And of course, we can support them in terms of our strong brand relationships brands that we carry that they don't carry today. And we like as well the format of this new acquisition where the 2 brothers remain as owners in the business and incentivized along with us to grow it, and we think that opens up the opportunity for further acquisitions of that type.

And again, a huge focus on client experience on events, et cetera. We really do believe that, that's a differentiator for us versus a lot of other retailers out there. And we're also able to -- as we added these categories to offer more things to our clients and in particular, our VVIP clients. So we're doing more and more events. We did over 250 events in the U.S. last year, recently spending more time in the U.K. and the quality of the events that the teams do here are fantastic as well. We're learning from each other and these events have strong ROIs. So clear focus on giving our clients one-of-a-kind experiences.

So there are 6 strategic pillars, and we're really confident that we can execute against all of them over the next few years. In terms of the changing dynamics on the watches and the demand out there, I would say that demand continues to be very strong for the super high demand brands. No surprise there. That's continued throughout the time period that we've been owning this business or sorry, part of this business. But I think the U.K. is off to a positive start in the first 10 weeks of the year. And we see with the U.S. just the wealth creation that is there and the fact that the market is still not as well developed as the U.K. or Europe, there's still a huge potential for growth in that market.

Great. Next question, how would you expect the business to perform if the AI bubble were to burst? I'm concerned the rally in AI stocks and the wealth created by AI-related businesses may have artificially boosted demand for watches.

Well, clearly, there is a correlation between wealth and demand in the U.S. market more so maybe than in the U.K. Here, I think the interest rates and people's feeling of wealth in their properties has a bigger impact actually. The U.S. market has had a good run in shares. The wealth creation that we've seen over the last 4, 5 years is around $40 trillion, which is an extraordinary amount. Swiss export data has not kept track with the wealth creation in the U.S. and the market remains underpenetrated within this luxury category versus other luxury categories.

And if you look at sort of where it sits, it's around 40% per capita consumption of this category versus what we have in the U.K. So we believe that the market will continue to grow long term. Is it growing faster given sort of where the stock market is? Yes, potentially. I wouldn't hesitate to say that. It's probably a factor. When you have the stock market crash in 2008 in the U.S., the market did take a big blow. It took a blow in the U.K. as well, but not of the same magnitude. So yes, there is more of a correlation between equity prices and luxury goods in the U.S. than what it is in the U.K.

Next question. Would you characterize your guidance for the year as conservative? Based on the underlying fundamentals and your comments, it's difficult to reconcile the expectation of around only 5% growth at the lower end of the range?

Well, first point to remind people of is that this is a 52-week year versus a 53-week year. So the underlying growth is predicted to be between 7% and 12%. Yes. I mean, listen, of course, we had pricing come through more than what we've seen at a normal level last year. And most of that pricing, we're going to annualize that in the second half of this year. So we've been a bit cautious on that factor. And we've had a long, long run of really good market conditions in the U.S. So a bit of sort of the comps in the second half are a bit tougher than in the first. Last year, we had to rebuild inventory that we announced last year when we came out with our quarter 1 sort of comments, which impacted the first half adversely last year. But obviously, this year, we don't have the same thing. So yes.

And are we conscious about sort of the world situation? Yes, we are. We have a change of guard here in the U.K. coming along, which could impact how people feel about things. You never know. We have the situation in the Middle East, which isn't directly impacting us, but clearly could drive cost of living up through energy prices and so forth. So we're a bit cautious. So if things brighten up and we have peace around in the world and the government doesn't do anything crazy, yes, maybe we're being a bit conservative.

One for you, David. Are there any areas of America where you think people still don't know the Watches of Switzerland brand well enough?

Yes. There are lots of areas in the U.S. And so look, the reality is that we have strong areas like Miami -- sorry, Florida, Georgia, where at least the group, through Mayors is very, very well known. The New York Metro area, I think we've done a very, very good job. And obviously, Vegas, where we've got significant presence. The rest of the country, we have got pockets of stores in different locations. We've certainly proven we can open up stores in different locations around the U.S. and open them successfully. But yes, we believe there's a long runway for us to go in terms of growth. Again, it comes back to the fact that we still believe that the market is underdeveloped, as Anders talked about the versus the U.K. There's a huge amount of growth still potentially there.

So yes, a lot of work still to do to grow the brand name. We do believe that Hodinkee will help that as well. They have an incredible amount of passionate horological experts and 25 million unique users. And certainly, there's the vast majority of those -- of the people that visit their websites would not shop in Watches of Switzerland today. Hopefully, a percentage will over time, and we've obviously got plans in that area. So there's a lot of work for us to do, and there's still white spaces out there in terms of new locations where we believe we can open up Watches of Switzerland multi-brand stores.

We've only been in the U.S. for a little bit more than 8 years. So we're relatively new to the market still. We're building our geographical footprint. The brand name is obviously to our advantage, Watches of Switzerland, what do they do? I mean we used to be called Aurum Group, which nobody knew what it meant. So the name sort of is easy to get out there, and there is no confusion about what we do.

Next question. Have you ever considered pursuing a U.S. listing for the business?

It's not something that we've actively looked at and the market cap of the company is fundamentally too small. As the presence of our business is expected to outpace the U.K. growth than the U.S., U.S. is going to become a bigger proportion of the business. So at some stage, that might be a consideration, but not anything that we have on the radar at the moment.

Are customers still waiting months for the most popular Rolex models or are waiting lists finally coming down?

So I'm not going to just specifically talk about one brand, but I would say that the registries of interest that we take for super high demand products that those lists continue to grow. And we work with all of our brands and with our clients obviously to try and satisfy them as quickly as possible. But yes, for the -- for those watches that are most in demand, people definitely have to be patient. And obviously, we want to try to get to them as soon as possible, but it does take some significant period of time.

And I just want to make a correction in the question. It's not months, it's years.

So for add -- but what I would also say to anybody that's interested in coming into our stores, we are still trying to balance that with bringing new clients in. So we're trying to make sure that, again, across the broad range of brands that we have because it isn't just one brand. We have many brands that have either very strong demand for all of their product or for a particular product. We want to make sure that at least over 30% of that goes to new clients. So we continue to add to our client base. So yes.

Next question. Would you say that the company is better positioned than it was in 2021? I'm just wondering why the market doesn't appear to properly reflect the progress you've made. The company is larger, more profitable and has now returned to growth.

Well, it's a good question. So obviously, we had the Bucherer transaction come through and which spooked some investors and had an impact on our multiple and how people viewed the risk profile. In spite of which Rolex confirmed the RNS that we issued back then, and it was repeated by Jean-Frederic Dufour, the CEO at the Dubai Watch Week back in the fall. So their behavior hasn't changed at all, but it's all perception by the market, I would say.

So that had an impact on our multiple. And we also had a profit warning in early '24, after which we've delivered 4 reporting cycles where we've always met or beat our number. So I think the sort of turning point is behind us now and confidence is starting to rebuild. So we'll see where it all goes.

Thank you. Pre-owned feels like a really exciting market. Could that eventually become just as important as selling brand new watches?

I don't -- honestly don't know. I don't think so. I think that the reality is it will be -- we've said that we think we'll get up to 10% of our business. And that's what we stick with at the moment. And we made that prediction pretty early on, to be honest, after we've gone into the certified pre-owned business. But we do believe over the next few years, it's going to continue to grow faster than the rest of our watch business. And again, as we said, it's attracting new clients. It's generally at a higher price, based on the product that we carry, and it also allows us to offer products to our clients that has been discontinued. So it's a big focus for us, but no, I don't see it becoming bigger than the newer business.

Is there another watch brand relative to Rolex that you think could become as important to the business over the next 5 years?

I would say that Rolex is an incredible brand, incredible partner. I don't think so. But what I would say is that what we are able to offer our customers is that multi-brand experience. We've probably got the largest selection of watch brands out there in the world. And that's something we're very, very proud of, and we're proud of the fact that we're able to offer time pieces from $1,000 up to well north of $1 million. So -- and what we're doing is I think we're continuing to develop a very, very healthy business in terms of the breadth of the sales across all of those price points and categories.

So whether it's -- whether it's Rolex or Patek or strategic partner brands like Cartier, OMEGA, Breitling, TAG and TUDOR through to independent brands that again, attract collectors like MB&F or H. Moser or a Bovet down to the more accessible price points like Oris and Longines that's performing very strongly. So no we're focused on making every brand that we have in our business work. But in terms of share of our business, no, I don't see any other brands in the next few years coming close to that.

One for you, Anders. Could you explain your logic for splitting maintenance and expansionary CapEx in the free cash flow calculation? Specifically, a maintenance CapEx of GBP 3 million or roughly GBP 15,000 per store seems low. Can you elaborate on how you arrived at that figure and how you think about it?

Well, obviously, expansionary CapEx is something that is discretionary. So maintenance CapEx is there to keep the stores going. That's how we classify it. And so in other words, CapEx that we spend to reconfigure stores or to expand stores is by choice and not necessity.

What value do you see Hodinkee bringing to the group?

I mean a huge amount of value in a whole series of different ways. Number one, first of all, we always had huge respect for Hodinkee when we came into the U.S. market. The U.S. market has been kind of underinvested, it would be fair to say by most retailers and brands from kind of 2008 onwards. In fact, the only thing of note that has happened in that time period prior to us coming in, in 2017 was Hodinkee getting formed by Ben Clymer. So I think it adds to our overall credibility as a serious watch player across all brands and price points, number one.

Number two, the reality is that they do have huge traffic. They're completely editorially independent. And so -- and we keep that. We don't know what they're going to write about. We've reinvested in their editorial team. And if you want -- if you saw our Capital Markets Day, you'll see that even Watson Wonders, which is effectively their Super Bowl that their viewing figures were up over 60%, which is incredible in the days of everybody being worried about AI. And so we're working closely with them. We do believe that Hodinkee can help to drive our e-commerce business in a number of different ways.

We're investing significantly in the Hodinkee app. And now you're able to get editorial selections from the different writers within Hodinkee. So James Stacey's picks, Ben Clymer picks and you can go directly to our website and purchase them. We're helping to support Hodinkee in terms of the limited editions because we're able to get even bigger, better limited editions if we're able to sell them in our stores as well. So we're working on a pipeline of limited editions over the next 2 to 3 years. And again, we hope that -- we think that, that will drive both our online business as well as our in-store business. And of course, we're doing a lot of events with the Hodinkee team in our stores, both in the U.S. and we've done a couple in the U.K. and it can help both the U.S. and the U.K. business.

We think about 10% of the followers are based here in the U.K. We did an event several months ago here with Ben Clymer and he sent out one Instagram post and 30 minutes later, we shut it down because 400 people at RSVP. And the vast majority of those clients that came to see them in our Watches of Switzerland store in London had never been in the Watches of Switzerland store before. So we still think there's a lot more that we can do to introduce the Hodinkee clients to our store network in a subtle way. And given the affinity and the loyalty that they have to the Hodinkee brand, if they end up becoming customers of the overall group, then we think that would be fantastic.

Great. Thank you. If luxury spending does slow down, where do you think Watches of Switzerland would feel it first? I guess in terms of market category.

I think, obviously, half of our business, we don't necessarily is going to change in profile within the foreseeable future. And that's the part of our business that's driven more by supply than demand actually. In other sectors, when we experienced what happened here in the U.K., which was a bit of a surprise and hopefully, our brand partners have learned a bit from that is when they went a little bit overboard on pricing and ranging that a bit of in sensitivity towards price elasticity. I think if a slowdown in luxury demand is sort of connected to that behavior, it's really hard to see how we can get that done.

I think they've learned a few lessons from what they went through. And I think luxury players in general, have learned a bit because there was a bit of greed in the post-COVID amongst a lot of luxury players out there, not just in our category but across the board. Everybody will have heard about what Chanel and others did, which had a backlash from their consumer base as well. So yes, I think as long as the brands are staying in tune with the consumers, I think the category, which is a discretionary category, of course, nobody needs a watch. Your iPhone is going to tell you time more accurately. It is a symbol of success and an accessory. So it comes down to how well the brands actually can read the consumer, I think.

And I think we have -- again, it's another one of the reasons why particularly in the U.S., you've got a huge group of people, younger demographics that are interested in horology. We're continuing to add to our client base. We're continuing to make sure, as I said, that a significant percentage of the product, the high-demand product goes to new clients. So we're not dependent on just one small group.

Would you say luxury watch brands are becoming more selective about who they want to sell their products?

Look, ultimately, at the end of the day, the luxury brands sell the products to retailers like us, and we're the people that make that choice. And so we're trying to broaden our customer base as much as possible. So no, I doubt that's the case.

I think also kind of in terms of the authorized dealer, I think maybe that was what was getting at in terms of the retail.

Of course, see -- thank you for that. So of course, the retailers certainly want to make sure that it is going through authorized channels that their clients are getting the best possible experience that the retailers are doing the right thing by the brand and by the consumer. And I think that's where we can play a great role as well. As part of a public company, being a public company, we have certain responsibilities. We're audited today as our CEO likes to say. And so I think we can be trusted as much as any retailer out there in terms of doing the right thing by the brand and then doing the right thing by the customer.

And I think maybe you may see a trend of more brands going down the authorized certified pre-owned model as well because, again, that it's part of their brand, even if it's getting sold on the secondary market. And I think brands want to make sure that, again, that's done in an appropriate fashion and that all of the product is using authorized parts has been serviced appropriately, et cetera. So in that regard, yes, I think that all of the brands have selective distribution agreements. They approve every agency that we open. We're very fortunate that we've got very strong relationships with our brand partners. But yes, of course, if we started abusing that in any way or any other retailer did then we would lose those agencies pretty sharpish.

And the requirements from the brands keeps on getting sort of upped all the time. So the latest topic on the list is nowadays about cybersecurity. Obviously, we have been sort of a big organization are well equipped in that space, whereas a lot of the independents probably don't know what we're talking about. So there is sort of a pressure coming from the brands about how we, as a distributor, handle the client data, how we handle the client interactions and so forth, which is just going in one direction, and it's getting tighter and tighter.

Next question. America seems to be doing the heavy lifting on the growth front, I think, at the moment. Is there still plenty of room to grow in that market? Or are you starting to have reached the easier wins already?

Again, I'll probably refer back to the answer from earlier in some ways to say, no, we -- well, I think it's all been heavy lifting. I've been out there for the majority of the time, and the teams are pretty busy. Look, we're really delighted with our progress in the U.S., as Anders said, we're like 9 years old there. We believe there's a lot more that can be done. We continue to strengthen our teams and invest behind the teams, which is something I think that is really good. We're investing for growth. So whether it's investing over the last year in our e-commerce team in changing out systems, investing in Hodinkee, investing in their editorial teams, investing in new senior management teams there as well.

We've got a new overall head of the U.S. business, new Head of Finance, new Head of Marketing. So we're bringing in a lot of strength in order to ensure that we can continue to grow. And so -- no, we certainly believe that there's a lot more that we can do. And we haven't mentioned Roberto Coin as of yet apart from just in terms of the start and the 6 growth pillars, but we're investing behind that brand as well. And we're starting to see -- we believe Roberto Coin will grow at a faster rate than the rest of the U.S. business over the next few years. So a lot done, but a lot more to do.

And then Anders, would you rather keep investing for growth? Or are we getting close to a stage where returning more cash to shareholders becomes the priority?

No, I think it's pretty clear in our capital allocation policy, what is our priorities. And the priority is always going to be to make sure that our network is up to par and standard. So investment in our showrooms and in white space locations that we can identify. The second priority is always going to be acquisitions. If we can't deploy the cash that we generate in those 2 growth pillars, then for sure, we were going to do buybacks and hand it back to you guys. So no questions to ask.

It's a good thing to keep an eye on is our ROCE. So we want to keep our ROCE north of 18%. And obviously, sitting on too much cash will suppress that. So that's a good metric to -- if you guys want to sort of try to identify when we're going to do it, keep an eye on that one.

And maybe just following on from that. So the group has a number of relatively new growth drivers, including Deutsch & Deutsch and Hodinkee. Any of these priority areas for investment? And if so, why?

Yes. I think in the case of D&D, there will be some investments made there. We can bring in new brands, as David alluded to earlier. That's one area. One of the stores, we might look at a relocation. So we'll see. But yes, a bit of capital is required, not anything material. One of the key findings, which is also something that we get when we do these acquisitions is obviously best practice. So we always look at our processes and see if there's anything we can learn as a company. And in the case of D&D, they had a couple of really good architects that was working with them. And we've actually signed them to one of our projects within the wider group to see what they can do. So yes.

I think there's -- and again, as we said Hodinkee, we're investing behind the Hodinkee app. And we've invested in the team. We've invested in bringing in more resources into the editorial. And I think people are seeing that in terms of the Hodinkee followers in terms of the quality of the writing and more content. And I think we're seeing that in the results as well in terms of the followers.

Great. And then where do you see the gaps between Roberto Coin and a brand like David Yurman? What needs to be done to close this gap to put Roberto Coin at a similar scale?

Well, first of all, I would say that David Yurman has done an incredible job. And we carry David Yurman both here in the U.K. and in the U.S. So a huge amount of respect for what they've done as a team. So what I would say about Roberto Coin is that when you look at a lot of the distribution that we're in, in the U.S., the 2 major brands would either be David Yurman or then Roberto Coin. We probably -- and that's what we're doing now is we'll continue to invest behind the brand in all of the different areas that also David Yurman invested in.

So investing in rolling out more shop-in-shops with our wholesale partners, investing in the online component of the business, robertocoin.com, investing in mono-brands. We've opened up the first 3 mono-brands, and we've got we've got more to follow. But I mean, again, as we said, we can learn plenty from David Yurman. They've done an incredible job. And I think it would be fair to say my background, Anders' background and Brian's background is quite a lot of that has been based on wholesale as well. We worked for Ralph Lauren for a number of years. So we believe all of the fundamentals of the brand are there. So great product, great sales team, and we just need to invest behind it and elevate the brand across all of the distribution points in North America.

I think one distinction between the 2 is that David Yurman has a very sort of consistent look and feel wherever you go and have a look at it. They managed to secure the space that is required to show their product collection in a very consistent manner, which is part of the success. And on the contrary, sort of Roberto has been designing fabulous products for 30 years, but essentially allowed each retailer to pick and choose products as they feel suits their store and then cram them into a small counter.

So the first step in this process is, as we've said, demonstrate that it works in shop-in-shop, go out, expand the space, make sure that we merchandise the product relatively consistently with adaptation, of course, for the local market. But that consistency is something that is required in order to build the brand à la David Yurman. In the department store space, if you go in and have a look, David Yurman is always the prominent brand in those locations. And Roberto Coin looks okay, but clearly it could do with some additional space, as I said. So yes, I think we know what we need to do.

Great. Thank you. That is all of the questions that we have had submitted. So maybe hand back if you have any closing remarks.

Well, thank you all for joining today. And we -- as we've said before, we're very pleased with what we see in the market and where we sit today. We have a long way left to go in the year, and we'll keep you guys posted.

Thank you.

Thank you to the management team for joining us today. That concludes the Watches of Switzerland Retail investor presentation. Please take a moment to complete a short survey following this event. A recording of this presentation will be made available on Engage Investor. I hope you enjoyed today's webinar.

So good afternoon, everyone. I always ask to get included in these videos, but somehow you always see them and I've been missed again from them. I wonder why. But good afternoon, everyone. I'm Brian Duffy, the CEO of Watches of Switzerland Group. I know many of you here. Welcome to our meeting. Thank you for joining us. Thanks to our friends at UBS for providing this fantastic facility. You're going to hear a lot of different accents this afternoon. So we thought we'd start with the most difficult first. But hopefully, most of what I've got to say will be conveyed by the slides if you find the accent difficult. Our objective today is to give you, our investor community, a more in-depth understanding of our business and our markets.

Our focus, our strategy is sustainable, profitable growth, and we'll go through the pillars of our growth in detail. We'll not be providing any specific financial targets beyond the guidance that we've given for fiscal '27, but we plan to give you the necessary information and building blocks to facilitate your projection of our business in the future years. We have some great things to present to you today. The work that our team have done in recent years, the extraordinary progress that we made in the U.S., $1.24 billion in sales in fiscal year '26 from our market entry only in 2017, support of our brand partners, the market trends that we are experiencing in both the U.S. and U.K., all combined to make me and our team here feel very confident and energized for the opportunities that we see ahead.

Our agenda today is group strategy and markets overview from yours truly. Then David Hurley, our Deputy Group CEO, will give you a U.S. business review, followed by Craig Bolton, President, U.K., through the U.K. business review. And then more detail on our new businesses that we want to tell you more about. Roberto Coin. I will also present. And we're delighted to be joined by Ben Clymer, here, the founder of Hodinkee, who will tell you the Hodinkee story and plans. We're also delighted to be joined by Tad Deutsch of Deutsche & Deutsch, who will present his family business and his experience in joining our group. We'll be followed by Anders -- that will all be followed by Anders Romberg, our CFO, for the financials, and then we'll take Q&A.

You can see from here some key stats in our group on the left. Scale is, in our view, increasingly important in our category. We enjoy strong market leadership position here in the U.K. luxury watch market and a very strong position in the fastest-growing market in the world, the U.S. We complement our positive luxury watch positions with a growing business in luxury jewelry in both markets. Our unique multi-brand, multichannel model is working very well in both the U.K. and the U.S. as you'll be hearing. We have a record over the past 11 years of consistent sales and profit growth and cash generation. We'll be presenting our growth pillars today, including our successful experience of acquisitions in the U.S. And finally, just to say our major market of the Swiss watches, has proved resilient continually and robust and continues to be characterized by demand exceeding supply, and we expect these conditions to remain for the foreseeable future.

Our showrooms are beautiful. They're spacious. They're welcoming. They're complemented by excellent client experience provided by our expert showroom colleagues. We represent the best brands in luxury watches with an increasing portfolio of international jewelry brands. Our relationship with the major watch brands go back many, many decades. The major changes to our business mix -- you've seen this chart before, but it's very important to understand the major changes in our mix has been firstly, geographic. And we can see the U.S. business back in FY '19 was 24% of our sales. And by fiscal year '26, the year that we just closed, now the majority of our sales at 51%. Our sales CAGR through this period was 13.1% for the group, 6.3% in the U.K. and a very impressive 26.4% in the U.S. The other major change to our sales mix, the bottom pie charts there resulted from the removal of VAT-free shopping in the U.K. for tourists on the implementation of Brexit. That resulted in a huge reduction of our international sales, as you can see. If we revise our group total CAGR, the 13.1% that I mentioned and do on a domestic-only business, the '19 to '26 CAGR was actually 18.9%, almost 19% and an acceleration effectively of our domestic business.

Our financial scorecard shows sales compounded annual growth from FY '15 through to the midpoint of our FY '27 guidance as 15.5% and adjusted EBITDA growth for that same period of 29.5%, so a record we're very proud of. Debt leverage for our group is very low, as you can see, the borrowings at end-fiscal '25 and '26 resulted from acquisitions, Roberto Coin, Hodinkee and Deutsch & Deutsch specifically. We also executed a GBP 25 million share buyback. ROCE for the group has settled at around 18%, 19%. Looking back at that 11-year history, we see 3 distinct periods in those 11 years. Firstly, the period 2014 to 2019, when we implemented our new model and more stable market conditions here in the U.K. than in the U.S. in 2017, gaining market share in both markets.

The 2020, 2025 period saw unprecedented volatility that we had to deal with Brexit, COVID, post-COVID, tariffs, gold pricing, price inflation, a really unprecedented volatile period. And our team have done a fantastic job reacting to those conditions, navigating their way through and delivering on good results. Currently, we're entering -- or we are already in a new period, and our experience is that market conditions are good and predictable and very much recognizable, continuing strong, very strong market in the U.S. and an improving market here in the U.K. Fiscal '27 has accordingly started well, and we are confirming our guidance for the year. Investing in sustainable, profitable growth is our strategy. I'll top line our growth pillars and then go into each one in a little bit more detail. We have a strong pipeline of projects with our existing showroom networks in the U.K. and the U.S., and we continue to be active in looking for opportunities of new developments and underserved markets focusing again, particularly in the U.S.

The pre-owned business has been very positive for our group, increasing from an almost irrelevant less than 2% back in fiscal year '19 and now over 8% in fiscal '26. E-commerce has been progressing well in the U.K., outperforming since the second half of FY '26 and continue to outperform now into the first quarter of '27. E-commerce in the U.S. is also progressing very well with strong growth from clearly a lower base. Jewelry is an important growth sector for our group and acquisitions remain a key pillar of growth and the activity clearly with client experience continues to elevate. Our showrooms are designed to be open, welcoming browsable, and nonintimidating. We're allocating more space to our growing segments of pre-owned and branded jewelry in our beautiful showrooms.

The Rolex flagship boutique in Bond Street, which I hope you've all visited, has been a great success since opening in March 2025, exceeding expectations. And with that store, we set a new standard of client experience. The pre-owned market is growing at a fast pace. As you can see here, our group is now very well established in this category for both Rolex certified pre-owned and other preowned luxury watch brands. From now on, we'll report the total pre-owned business, which the graph shows has increased from 1.6% of our sales in FY '19 to last year, 8.3%, and it continues to grow. Interestingly, our client database shows that the great majority of our pre-owned clients, 77% to be exact, are new clients to our group and that we're clearly increasing our audience overall. We enjoy a very good business in rare and high-value time pieces, as you can see, often sourced directly for collectors.

These pieces are especially important in markets such as Las Vegas, New York and London. E-commerce is a growing segment, and our excellent teams in Leicester and Fort Lauderdale do a great job. We have sites for each space here, as you can see, but through common systems, we support an optimized execution of the back end. Scale is particularly important for e-commerce, optimizing marketing spend and supporting in-house teams of experts. We offer the customer a wide multi-brand selection and our clients often research online and buy in store and vice versa. Our virtual boutiques in the U.K. and the U.S. offer online clients specialized support and help online achieving high levels of conversion. And the online presentation of both Rolex and Patek Philippe, which are not transactable online, are nevertheless a perfect research vehicle for showroom clients.

The U.S. market for luxury jewelry is the #1 market globally at almost $65 billion, showing significant growth in the recent years. Interestingly, some research that was published by McKinsey, showed that self-purchasing was a key driver of growth, increasing '24 versus '21 by a very significant 58%. We honestly believe this is one of the main things behind what's been a great growth record of this market. The trend is clearly towards branded jewelry, and we are very well positioned in the American market with the Roberto Coin brand. We're also experiencing a resurgent U.K. jewelry market with the success of branded jewelry and also lab-grown diamonds, which have gone very well for us.

Acquisitions have been a key to our success in the U.S. Through acquisitions, we expand our geographical penetration, extending new segments, wholesale and media, for example. And importantly, through acquisitions, we've gained complementary expertise and market experience. Financial returns on acquisitions have been very good. We have built a strong reputation under David's leadership in the U.S. market through successful acquisition negotiations and ultimately, integrations. A core aspect of the WOS model throughout our history has been client service. Luxury client expectations continue to increase, and we continue to respond with our Xenia hospitality program, fantastic events and the support of online clients through our virtual boutique.

Our successful growth strategies have resulted in a positive diversification of our business, both geographically with the expansion of the U.S. success and by product category with the success of luxury jewelry and preowned. So to summarize the introduction, market conditions we're experiencing to be good. The U.S. continue to be very strong. The U.K., we describe as resurgent. Our model continues to perform very well. All of our growth pillars, as you'll hear, are all contributing as planned and expected. We are adding new audiences through Hodinkee, through preowned, through online, through an increased activity with female clients through jewelry in addition to the build of our client databases. Fiscal year '27 has started well.

I'm now happy to pass over to David to discuss the U.S.

All right. Okay. Good afternoon, everybody. So a little bit about the U.S. So our U.S. business has delivered exceptional growth since we entered the market in FY '18. What began with the acquisition of Mayors has grown from approximately $120 million to revenue of more than $1.2 billion in less than 9 years. What's particularly important is how that growth was achieved. This wasn't simply an acquisition story nor was it dependent on a single market trend. We've consistently added new growth drivers, including acquisitions, showroom investment, e-commerce, pre-owned, client experience, luxury jewelry and most recently, Roberto Coin, Hodinkee and Deutsche & Deutsche. The result is that today, we operate a diversified luxury platform with significantly greater scale, stronger brand relationships and far broader growth in opportunities than when we first entered the market. Perhaps the most exciting aspect of our U.S. story is that the opportunity remains substantial. The U.S. is not a mature consolidated market.

Unlike other countries, the wealth is distributed broadly across states and metropolitan areas. At the same time, luxury watch and jewelry retail remains highly fragmented with many operators controlling only a handful of locations. This creates opportunities in 2 ways. Firstly, it provides opportunities for acquisitions. Secondly, it creates white spaces for organic expansion into attractive luxury markets where we believe our model can outperform. While we built a sizable business, we continue to see significant runway for future growth. Building on this opportunity, this chart shows the strong relationship between U.S. wealth creation and demand for Swiss watches. As household wealth in the U.S. has grown, Swiss Watch exports have followed a similar trajectory, though the exports have not kept up with the wealth creation resulting in a pent-up demand.

That's important because it demonstrates that our growth opportunity is supported by powerful long-term market fundamentals and not just store expansion. With wealth generation extending across the country, we see significant potential to continue growing our customer base, deepening relationships with existing clients and expanding into new markets. But exploiting these markets and building revenue is one thing, building an organization capable of sustaining long-term growth is something entirely different. Over the last 8 years, we've deliberately evolved from the business largely supported from the U.K. into a fully capable U.S. organization. We've invested in leadership, infrastructure, systems, marketing capabilities, e-com resources and specialist talent. We've also imported best practices from our U.K. operations while adapting them to the unique dynamics of the U.S. market.

FY '26 represented an inflection point in that development. Many of the investments made in the last year were in investments ahead of growth. Today, we believe we've got the management structure, systems and local expertise required to support the next phase of expansion while increasingly benefiting from scale and operating leverage. In terms of this -- our strategic pillars and talking about showroom investment. Today, we operate multiple luxury retail fascias, including Watches of Switzerland, Mayors, Betteridge and Deutsch and Deutsche. We have a leading position in preowned through Analog Shift. We operate 33 mono-brand boutiques. And through Roberto Coin, we have access to more than 400 points of distribution. This diversification is strategically important. It broadens our customer reach, gives us exposure to multiple luxury categories and strengthens our relevance with both clients and brand partners.

Most importantly, it gives us multiple avenues for growth rather than relying on any single format, geography or customer segment. Organic growth remains a significant contributor to our future plans. The projects shown here represent targeted investments in attractive markets where we see strong customer demand and the ability to deepen our local presence. Importantly, we're not just pursuing our growth through store count alone. Every project is evaluated based on location quality, brand support, customer demographics and expected financial returns. The pipeline includes new Watches of Switzerland locations, Betteridge expansions, Mayors developments and additional Roberto Coin boutiques as well as new agencies to follow. Markets such as New York, Miami and Las Vegas continue to represent attractive opportunities for reinvestment because of the strength of the local demand and tourism.

Certified pre-owned has become one of our most attractive growth opportunities within luxury watches. The category is attracting collectors, providing access to rare references and introducing new consumers into the luxury watch market. Our acquisition of Analog Shift gave us immediate expertise in sourcing, authentication, content creation and client engagement. What we particularly like about pre-owned is the customer dynamic. Many clients enter through pre-owned and subsequently become purchasers of new watches, jewelry and services. As a result, pre-owned supports both client acquisition and lifetime value expansion, making it strategically important beyond just simply generating revenue. E-commerce. So e-commerce remains one of the largest untapped opportunities within our U.S. business. Over the last year, we've invested significantly in the foundations required to scale digitally.

These investments include a dedicated e-commerce team, a move to Shopify, enhanced capabilities and integration with the Hodinkee ecosystem. We've already demonstrated in the U.K. that e-commerce can become a significant and profitable channel. The U.S. currently operates at a much lower level of penetration than the U.K., which provides a substantial opportunity for growth. As traffic scale and conversion increase, we expect e-commerce to become an increasingly meaningful contributor to revenue and profitability. Jewelry is another major growth opportunity. The U.S. jewelry market remains significantly larger than the luxury watch market and continues to benefit from strong consumer demand, increasing self-purchasing trends and growing interest in branded products. Our strategy focuses on increasing penetration of Roberto Coin through shop-in-shops and dedicated branded spaces. Brian will present the overall Roberto Coin strategy later on in this presentation.

And we'll complement that by investing and developing other categories such as high jewelry and lab-grown diamonds. We believe jewelry will continue to become a larger and more increasingly important contributor to our overall growth profile. Acquisitions have provided -- have played an important role in building our U.S. business. However, our philosophy has never been acquisitions for acquisition's sake. What matters is what happens after we buy the asset. Our track record demonstrates an ability to enhance acquired businesses through investment, showroom upgrades, CRM capabilities, stronger brand relationships, clienteling and operational expertise. As this slide shows, the revenue generated by businesses we've acquired has been significantly expanded post-acquisition.

Importantly, we remain disciplined. We're looking for assets that enhance our strategic priorities, accelerate market penetration and create value through integration into the broader Watches of Switzerland Group platform. Luxury retail is ultimately a relationship business. The strongest luxury retailers are not simply selling products. They're building communities and creating memorable experiences. During FY '26, we hosted more than 250 client events. bringing together collectors and enthusiasts and VIP clients around the brands and products they love. These events generate significant engagements, but also have a clear commercial benefit.

They help deepen client relationships, increase brand loyalty and contribute to repeat purchasing behavior. In our view, client experiences remain one of the most significant differentiators in the luxury market. So to summarize, in less than 9 years, we built a $1.2 billion luxury platform in the world's largest luxury market. We've expanded our capabilities, diversified our growth drivers and invested in the infrastructure required for the next phases of growth. While we remain excited about the opportunities ahead in the U.S., our U.K. business continues to be an important source of market leadership, cash generation and innovation.

And with that, I'll hand over to Craig.

Thanks, David. Good afternoon. My name is Craig Bolton. I'm the President of our U.K. business. Today, I will provide an overview of the key objectives and performance of the U.K. business, demonstrating how we are delivering against the strategic pillars Brian outlined earlier and continue to strengthen our position as the leading luxury watch and jewelry retailer in the U.K. Before looking ahead, it is worth reflecting on the significant journey that the U.K. business has been on over the past decade. The period for FY '15 to '26 has been a significant evolution for our U.K. business. It is bookended by 2 landmark openings, 155 Regent Street, which helped redefine the luxury watch retailer in the U.K. and most recently, the Rolex boutique on Old Bond Street, which has quickly established itself as a standout success.

Between these milestones, we have successfully navigated a number of market challenges, including Brexit, the removal of tax-free shopping and COVID, while continuing to invest in the business and strengthen our market position. Over this 12-year period, we have delivered a sales CAGR of 8%, outperforming the broader watch and jewelry market and demonstrating the resilience of our business model and the strength of our long-term growth strategy. This track record provides a strong foundation for the opportunities ahead. We are trusted partners for the world's leading luxury watch brands and operate at meaningful scale within the U.K. market. Today, we hold a market-leading share of the U.K. luxury watch market, significantly ahead of our nearest competitors with further opportunities to grow share over time.

In recent years, we have simplified and refined our brand portfolio, increasing our focus on the luxury brands that matter most to our clients. Each brand plays a distinct strategic role driving client acquisition, sales growth, profitability, differentiation and cross-selling opportunities. Together, they create a balanced and resilient business model. Pre-owned has been our fastest-growing category since the launch of Rolex Certified Pre-Owned in September 2023, and we see a significant opportunity for continued growth. Since launch, we've expanded to 30 Rolex-certified pre-owned showrooms and 42 Watches of Switzerland certified preowned locations, supported by 3 dedicated e-commerce platforms. We expect to further increase our footprint during FY '27.

We've invested in high-quality brand environments, broad and compelling product assortments and specialist training for our showroom teams, creating a strong platform for future growth. Our dedicated team of pre-owned experts continue to source an exceptional range of products, including rare off-catalog and highly sought-after timepieces. The examples on the screen are watches we've sold in recent weeks. Our scale, product procurement and fully integrated omni-channel approach differentiate us from all other U.K. competitors and position us as the market leader in the pre-owned luxury watch market. Luxury jewelry is an increasingly attractive category in the U.K. driven by growing brand awareness and increasing demand for self-purchase and everyday luxury.

We are well positioned to benefit with a curated portfolio of leading jewelry brands and appeal to both existing and new clients. The Mappin & Webb Jewel House in Manchester is a great example of this strategy in action, bringing a dedicated luxury jewelry destination to clients beyond London. The early learnings also help shape brand deployment across our wider estate. Early performance has been good, reinforcing our confidence in the long-term growth opportunity within branded luxury jewelry. Lab-grown diamonds launched in November 2025 and have become our fastest-growing and most productive jewelry category. The proposition is attracting younger clients and highly incremental sales with more than 80% of sales generated from new demand. Average transaction values are comparable to natural diamonds, but lab grown allows clients to access larger and higher-quality diamonds at a similar spend level.

Following a successful launch, we have expanded the range further in Goldsmiths and launched the range in Mappin & Webb and recently introduced the first phase of our online bespoke builder, which allows clients to fully customize their jewelry, adding over 1,000 new options, growing to over 3,000 new options on completion of Phase 2. We are already seeing strong sales through both our showroom and digital channels, giving us confidence in the significant growth potential of this category. Over the past 3 years, we have strategically reshaped our showroom estate, moving toward fewer, larger, and high-impact locations. Importantly, where we have reduced stores, including Rolex locations, we have increased market share. And where we have exited mono-brand boutiques, we have successfully transitioned those brands into our multi-brand environments, maintaining strong sales whilst improving productivity.

Despite a challenging macroeconomic backdrop, we have continued to invest significantly in our estate through luxury refits, expansions and relocations across Watches of Switzerland, Mappin & Webb and Goldsmiths. There are many excellent examples, including Mappin & Webb Birmingham, which showcases our latest luxury jewelry and watch concept and Northern Goldsmiths in Newcastle, the first Rolex retailer in the U.K. dating back to 1919, which has been beautifully restored and repositioned for the future. Alongside these projects, we have a number of significant investments planned through FY '27 and '28. This combination of estate optimization and continued investment has delivered a substantial improvement in productivity. Over the period, sales per showroom have increased by 150% from GBP 2.6 million to GBP 6.5 million, while showroom costs as a percentage of sales have reduced from 26% to below 19%, demonstrating significant operating leverage across the estate.

Alongside the significant investment across the wider luxury estate, we continue to invest with confidence in major Rolex projects. The first is the Rolex boutique on Old Bond Street, which opened in March 2025. It represents the pinnacle of Rolex design, combines an exceptional client experience with outstanding execution from our team and continues to perform extremely well commercially. Looking ahead, our 2 most significant projects are in Glasgow and Heathrow. In Glasgow, we will more than double the size of the Rolex boutique, introduce certified pre-owned and significantly elevate the client experience. This showroom is scheduled to open in October 2026. At Heathrow Terminal 5, we will begin work on what will become one of the leading Rolex travel retail boutiques globally, featuring a design unique to this location. The project is expected to open in the first half of calendar 2027, while we continue operating from our existing Terminal 5 boutique throughout the redevelopment. Whether through major flagship projects, showroom enhancements or branded environment installations, all of our investments are focused on the same objective, driving sales growth, improving productivity and further enhancing the client experience.

This slide illustrates how we are bringing together digital and physical retail to create a truly integrated omnichannel client experience. Our digital channels are not separate from our showroom estate. They work together to drive demand, deepen engagement and support showroom productivity. The virtual boutique provides a seamless bridge between online research and personal engagement, allowing clients to connect with specialists, receive tailored advice and move effortlessly towards purchase either online or in a showroom.

Our luxury showrooms remain at the heart of the client journey. Digital enhances this experience by helping clients discover products, research options and engage with our brands before they visit, resulting in more informed conversation and higher sales conversion. Through web-enabled sales, colleagues can access approximately 30,000 SKUs across the group compared with around 1,300 SKUs held in a typical showroom. This significantly expands client choice and creates additional sales across our network.

Importantly, the relationship continues beyond the showroom visit with digital channels supporting ongoing engagement and enabling clients to browse and purchase seamlessly across the group. We continue to invest in the future of this platform through enhanced user experiences, AI-enabled tools, intelligent search and the data capabilities that will support the next generation of client engagement.

Ultimately, our objective is simple: combine digital convenience, showroom expertise and technology to enhance the client experience, improve productivity and drive sustainable growth.

In recent years, accelerated by COVID, client expectations have risen significantly. Today's luxury client expects a seamless, personalized and memorable experience at every stage of their journey. We already deliver best-in-class client experiences across many parts of our group. The opportunity now is to scale that consistently. That's the role of our Xenia client experience playbooks, a clear framework for delivering exceptional personalized experiences at every touch point.

First launched in the Rolex Boutique or Old Bond Street and now being scaled across the group. The playbook also gives our key sales colleagues access to Power BI insights, allowing them to use our significant client database more effectively to identify opportunities, deepen engagement and support improved conversion. The objective is simple: consistency without becoming robotic, process with personality and excellence across every showroom.

We believe this will become an even more meaningful differentiator for our group. The program has already been rolled out across all Rolex showrooms and will be extended across the rest of our estate by the end of FY '27. Events, hospitality and exclusive experiences strengthen client relationships, create emotional connections and build loyalty as well as driving long-term engagement with our brands. We have a strong track record in this area and an exciting program of events planned for the year ahead. Success is measured not only by sales generated at the event itself, but also by future pipeline, client engagement and ultimately increasing the lifetime value of our clients.

The final aspect of client experience I want to touch on is aftercare. This is one of our most significant opportunities to build loyalty. At this stage, clients are already an owner, but often has considerable personal and emotional value and how we care for it will have a lasting impact on their relationship with us. While Aftercare is often overlooked in this industry, we see it as a powerful way to differentiate our proposition and deepen client loyalty whilst building the lifetime value of our clients.

So in summary, the U.K. market has experienced a period of significant volatility from FY '20 through much of FY '26. However, performance improved during FY '26 and has improved further into FY '27. The market today feels more stable and recognizable, providing a stronger backdrop for growth. With the majority of our estate optimization now complete, market-leading brand partnerships, growing opportunities in categories such as certified preowned and lab-grown diamonds, a differentiated omnichannel proposition and exceptional teams delivering outstanding client experiences, we are confident in the opportunities ahead. Thank you. I'll now hand back to Brian to discuss Roberto Coin.

Thanks, Craig. We love the Roberto Coin brand, celebrating 30 years of the brand this year. Really great people. I was with Roberto and his wife last week at our social engagement. They're really, really great people, and we certainly love the brand and love dealing with them. We see a huge potential for growth with this brand. First of all, in elevating the brand through marketing. Our strategy is the elevate the brand through marketing, a new campaign with Dakota Johnson has been very successful and continues.

We then plan to elevate the brand presentation and grow the business in all distribution segments being wholesale, monobrand and export markets. And I'll update you on the status and potential of the growth plans as we go through. Roberto Coin is one of the few brands still under the direction of the founder of Roberto, as you can see here. Roberto's family are actively involved and passionate about the brand, as you would expect. It includes his wife, Pilar, you can see here, responsible for marketing, PR and events. Son Carlo is responsible for all operations and product development and the youngest son on the last time he's there, Kevin, supporting our strategy and brand development. They're great to deal with, and it's been a real pleasure to get to know the Coin family and work with them closely.

The Roberto Coin brand is a true European luxury brand, distribution in Europe and the Middle East is primarily through mono-brand stores, as you can see here. Roberto Coin Inc., now owned by the Watches of Switzerland Group, distributes mainly through wholesale in U.S., Canada, Mexico and the Caribbean. The business has been managed by Peter Webster for 28 years out of our New York showroom with a very strong commercial and logistics team.

The great success of Roberto Coin brand in America is fantastic product and high-quality multi-brand distribution. We see significant growth potential through investing in the brand image, increasing ASP and growing the brand in all distribution. We've invested in the Dakota Johnson advertising campaign with brand advertising, PR and co-op execution with our partners. The brand enjoys great celebrity PR shown here with Nicole Kidman and Cynthia Ervio.

Events are very successful, very impactful for the brand, especially when Roberto appears as he did recently, shown here at the opening of our Miami store, Miami Design District and one evening with his presence and the wonderful product, we sold 1.5 million, just showing the impact that these events can have. Our watches of Switzerland team developed a training app, Roberto Coin -- my Ruby, providing full training on the brand history, brand positioning, collection inspiration and product.

The app is still in development and will provide a communication platform for PR and other developments. It will go live in September, and it will really elevate the sales associate connections with the brand.

At our Mayors stores, we've implemented new shop-in-shops where previously, we only had caseline presentation. The results shown here have been excellent, quite extraordinary, honestly, growth almost 3x, 186% growth versus the distribution before was in caseline. Average selling prices increased by 66%. The other, we haven't done shop-in-shops everywhere, so the non-shop-in-shop stores have also improved, but at 68% compared to the shop-in-shops are at 186%.

Roberto teams have been presenting these results to our major wholesale partners and have secured 17 shop-in-shop installations that will be done by January '27, and we have a further 31 under discussion at this point, and this is a major driver of growth. This, for example, is a new shop with our Mexican distributor that will be implemented in January. We've opened 3 monobrands so far, New York, Miami and Vegas, which are going well. 3 more planned, Tampa and Aventura in Florida and a second store in Vegas. We've implemented a completely new website, which is performing very well as shown in the order value and conversions that you can see here.

So we plan and expect that the Roberto Coin business will be a strong growth driver in the years to come. And to help your forecasting of our projections, we are planning ASP growth. We're planning wholesale expanding shop-in-shops at a rate of something around 20 per annum. We will be doing more mono-brand stores. It's somewhere around about 4 per annum for in-house monobrands. And we'll look to do monobrands with our partners probably from fiscal '28, somewhere around about 3 or 4 per annum. Online will grow and the export markets will grow. Roberto Coin brand has great potential and a very, very important addition to our group. I'm delighted to hand over to Ben Clymer, Founder of Hodinkee.

Are you guys still with us? Okay. I know after 30 minutes, it gets -- everything gets a little dry. So I'll do my best to entertain a little bit here. So how many of you know who I am or know what Hodinkee is? Anybody? Okay. That's pretty good. So I'll give you a little bit of the story of where we come from and where we're headed within Watches of Switzerland. And I think the question that was asked when the deal was announced in October of 2024 is why? And I think it was a fair question, right? I mean, Watches of Switzerland is this historic 100-year-old plus traditional retailer and Hodinkee is -- for lack of a better term, it's a big blog. I would take some offense of that, even though I just categorized myself as a blog.

But I understand the question of why would Watches of Switzerland acquire a business like ours. And I think the opportunity is everything. And the reason why I'm here today in front of you is the opportunity. And for those of you who have followed Hodinkee from the early days, you'll probably know that I'm a builder that's what I get off on. That's what I really love. And I think the opportunity when David and Brian called me and said, "Hey, we're looking at this business. And you have to remember at the time, I wasn't really in the business. And they said, would you come back?" -- and I said, "Well, let's have a few coffees, let's chat about it.

And when I realized just how big Watches of Switzerland is and what's possible with WOSG, I decided to come back, and that leads me to today. So this is Hodinkee as of this fiscal year. So we see around 25 million unique users per year, doing about 36 million sessions. Instagram, we have 1.1 million followers doing about 23 million, 22 and change million impressions per month. Facebook, we still use, but not in a concerted way. YouTube, however, remains a big part of our strategy. We're seeing about 61,000 hours per month of viewership. We've been on YouTube and other formats such as Vimeo, which we actually use before YouTube for over 15 years.

So we are certainly not the biggest on YouTube, but we are certainly one of the most engaged and the audience there is incredibly, incredibly loyal. You'll see that on a slide coming up. So the Hodinkee Media portfolio, for those who may not know, is dot-com. It's a beautiful magazine that we publish twice per year and is now distributed in the U.K. via watches of Switzerland stores, 30,000 copies each. The cover price is around $40. So this is not a $5 throwaway magazine. This is really more like a coffee table book. This is a half of a picture of it right there. We have the Hodinkee app, as both David and Brian mentioned, really robust, and we'll get into that later. We have native content. We have videos. You can see one over there. I hosted a video with Freddie Porsche, who's obviously of the Porsche family. So we have really a wide range of digital products and physical products to meet people wherever they are.

Within the Hodinkee audience, we have something called a community member. What this means is we have every piece of information about these folks that they're willing to give us. That could be age, demographic, where they're located predominantly in the U.S. We have around 370,000 active community members. What we mean by that is people that come on to the site or app every single month and comment.

So after Instagram and after Reddit, we are the most engaged place to comment and discuss watches in the world, which is incredibly powerful. And this community continues to grow. We have the opportunity to upload your watches to the community. We have around 0.25 million watches uploaded there. So incredible data on who our community is and kind of what they do. It should be noted that these are kind of our power users. These are the people that really engage with us every day. These are the people that are following every launch, every limited edition, every magazine.

So while the broader traffic is almost 10x this, this core audience is incredibly powerful, always has been. As some of you may know, we were a retailer at one point. It was this audience that really drove the growth of sales in e-commerce. You're seeing over 1,000 comments on the site per month. Here are a bunch of accolades. I didn't make this slide. I swear. Actually, I did make this slide. But here's a picture of me, lots of awards, whatever. The New York Times quite famously and in a friendly way called me the high priest of virology. Many years ago, I was on the cover of Conde Nast Traveler. Brian likes to point out that Cameron Diaz was also in that issue, and they put me on the cover.

Let's see what else. So we have been named one of the 50 best websites in the world, lots of other stuff. An interesting one was Fast Company, which is a big entrepreneurship and business magazine in the U.S., named us one of the top most innovative companies in the world 4 different times. And that was 3 times for media, once for retail. That was for this idea of really bringing content community commerce together. Some would say, including them that we are the archetype of that format, and we continue to believe in that model today.

Finally, and I do like to brag about this one. So Fortune named me one of the 40 under 40 business leaders. And in that issue of the magazine, which I still have somewhere, I was next to Beyond today. So that one felt good. So the Hodinkee portfolio, as I said, we have the website, we have the native app. We have newsletters, which has about a 50% open rate, which those of you from the media world know is just astonishing.

Social media is about 2 million-ish. -- sponsored content, which is native storytelling that we create in-house. The magazine, as I mentioned, is collectible and really very beautiful. Talking watches and video podcasts, which we'll get to. And then, of course, the Hodinkee brand, which we think really means something to a particular set of people.

On to traffic. So as I mentioned, there was a brief period of time where I was not in the business. We had sold control of the business to private equity shop in about 2020. I moved into a Chairman role and things got a little crazy as they tend to do. Having said that, during that time, watches really hit an amazing stride, right? This is the COVID era where all collectibles just went bananas. And during that phase, we saw record traffic because people were just so fascinated by the idea that you could buy a Daytona for x and sell it for 2x or whatever.

I'm happy to say that now with the team that we've put back in place since I took back over with James Stacy as our Head and Chief, we're now seeing the highest traffic levels in the history of Hodinkee. This is just a case study of Watches and Wonders. You can see the delta here. This was, in fact, the #1 most trafficed week in the history of the site. You have to remember, Hodinkee is 18 years old. So that's saying something considerable. We've had some kind of freak mass popular stories in the past, like the first Apple Watch story, we did like 1 million views in the first day. But short of those kind of anomalies, we had the highest traffic in our history, this Watches and Wonders, which is amazing.

This just accounts for users on the website. What it does not account for is what we did on social. So I'm proud to say that this week -- this Watches and Wonders Week, we actually did close to 30 million impressions, including social. On the very first day of Watches and Wonders, we published 78 stories at 78 human written, not AI written stories about watches. There is nobody that did 1/10 of that anywhere in the world in any language. So really far and away the leading source for content. To give you an idea, and this doesn't happen often, but Rolex allowed us to see the product ahead of time. Rolex historically doesn't do that, protect it as well. We have the relationships and the history with these brands to be able to have access to things well in advance. So really wonderful to see that in spite of AI and everything that's happening online that those that are creating great original content can still survive and thrive.

We tend to view ourselves as a media company that acts more like a friend and adviser. And I think a lot of people think that they know me and James and the people on the editorial team because we're on YouTube and Instagram every day. And in some cases, they do. In some cases, it's creepy. But the audience access, I think, is really interesting because these are really trusted relationships. And by now, I know and many of our editors know some of the biggest collectors in the world, and we take that really seriously. And what we've always said is watches are for fun, right? Like this isn't -- we're not curing cancer here.

But I think we want to make sure that we're always honest with our audience in a way that is really sincere. So if we wrote a story about a new whatever, Rolex Omega, TAG Heuer, -- and we said this is a watch that we really love. I would want to be able to look at any one of you in the eye and said, you like this watch and you can afford it, you should buy it. And that is a very easy test to kind of instill upon our staff, but I'll tell you that a lot of folks out there don't often do that. And what I say -- what I mean by that is other people that are writing about luxury products, it's who's buying the advertising, who am I helping out on the publicity team, et cetera. We really believe that we want to cover only the good things out there and make sure that we're spending our time on the products that deserve to be covered.

We have a halo around the Hodinkee brand. There's something called the Hodinkee bump. Again, not something I made up, although it sounds like I did. And what this means is basically any time we would cover certain products, you would see that the price of those products go up almost instantly. We saw it often in the early days of the vintage world. We saw it often during COVID when we would cover a pre-owned Rolex, 14270, which is a 1990s Explorer. It went from $6,000 to $10,000 in about 3 weeks. Things like that would happen often.

Top of funnel influence. We'll get to some interesting stats later, but effectively, everything we do, everything we do about watches is selling a watch for somebody. And I think that's the interesting thing, perhaps the frustrating thing for me, if I had a nickel for every watch we sold globally from our content, I probably wouldn't be standing here. But the influence that Hodinkee has in terms of driving sales is just remarkable. And then as I said, this is differentiated and defensible. We've been doing this for 18 years. This isn't something -- this isn't a tiktoker or a guy on 47th Street that says, "Hey, I want to make some money selling launches like this is something we really believe in. This was homegrown. This was bootstrapped for the first 10 years. We didn't raise capital until 10 years in or 8 years in. This is something that is really organic.

This is our audience. This is -- I should say this is our audience member. So relatively affluent person. Average age is generally around my age. Basically, our audience has grown up with me. So as I get older, I guess the audience might too. Sorry about that. The audience is mostly male. What's I found really fascinating here is that we define luxury watches. This is an internal survey. Luxury watches above $10,000. The average Hodinkee reader owns between 5 and 7 luxury watches. There are some outliers for sure, in both directions, but amazing. 90% trust Hodinkee as the primary source and 66 2/3 of the audience have purchased something based on Hodinkee content, which is really quite remarkable. So people are really making buying decisions based on what we're doing.

The business of Hodinkee today is a little bit different than it was a few years ago. It's much more capital light right now. Advertising and brand partnerships, very simple. We'll cover it, but very simple, limited editions and insurance. So advertising is exactly what you would expect, right? I mean it's display ads. It is events. This is me hosting an event for Vacheron down at their new boutique in Miami.

And to be very clear, right? Like everybody knows that Hodinkee is fully owned by Watches of Switzerland. We sell Vacheron in a multitude of places. This boutique is not ours. This is the Vacheron boutique that's factory-owned in Miami, and they still chose to pay us to host it to give you an idea of the relationships we have with the brand.

Display still is a very, very strong business line for us. As the world becomes more challenging, the idea of brand marketing becomes less interesting to brands and the idea of actual -- what can drive sales becomes far more compelling. And Hodinkee still is the largest audience in the world of people that actually want to spend money on watches. So -- the traditional advertising business is an incredible one. I'm proud to say it now includes Rolex online. Rolex doesn't traditionally spend with what they would call a trade magazine, which is watches only. They've had a month-long takeover on the site, which includes takeovers for the U.S. Open golf in the United States and then Wimbledon this past weekend.

It should also be noted that our very first advertiser ever was Audemars Piguet, and that was done when Francois Bennahmias was running the U.S. So we started with AP as our first advertiser, which was incredible, and it's kind of been going on ever since, and AP is still a large client of ours today.

Limited editions. These are products that we design and build and create with some of the best brands in the world. I'm actually wearing one right now. This is the Hodinkee Von Constantem, which is right there in the New York Times. We have a long history of this. Some of them have been really life goals, if I may say. To be able to work with Hermes, we've collaborated with Hermes 2 times. This color blue there is in the Hermes archive in Paris called Hodinkee Blue. We designed that with Pierre- Alexis Dumas.

This TAG Heuer was a $6,000 watch at retail. It now trades for about $30,000 on the secondary market. The Vacheron, which I'm wearing was the first time a Vacheron was ever sold on the Internet. I was on CNBC talking about that. We've worked with IWC, with Omega, with MB&F with wonderful brands. And long before AP collaborated with Swatch, we've done several collaborations with Swatch, and we took over Times Square every December for about 3 years. So really an incredible history of this.

The sellout rate is effectively 100% oftentimes in seconds, sometimes in minutes, occasionally in hours, and every now and then it might take a day. But the sell-through rate is just extraordinary, and we've been doing this for a long time. And it's probably something I'm most proud of, and I certainly enjoy the most. And as of probably 4 months ago, I am back running this for Hodinkee. So you'll see some amazing things coming out starting later this year, but in the next 18 months to 2 years, you'll see some very cool things. We'll say that.

Insurance. Hodinkee Insurance was another, I would say, baby of mine in a previous life. In 2018, we launched this product for me, basically, right, which is somebody that travels a lot, that has a lot of watches, but doesn't necessarily want to take out a rider for their apartment insurance or homeowners insurance. We wanted to build a dynamic system that allows you to ensure the watches that you were traveling with.

So I'm in London right now, as you see. I have one other watch with me. I insure via the Hodinkee app just those watches. All my other watches are at home in a safety deposit box, they're good. I don't need to spend the money to do that. So we devised this plan with our partners at Chubb to create dynamic insurance that is done via the Hodinkee app or Hodinkee.com. At this point, with literally 2 employees working on it, we are underwriting -- I shouldn't say that, Chubb is underwriting. We have built a business of over $1 billion insured with 267,000 watches catalog. So again, the data that exists here is just simply remarkable. And we really believe in the insurance business, a, just as a great service to the industry, but also as an incredible business.

The magazine. I love -- I went to journalism school. I love media, I love print. Doing a magazine was something we always wanted to do. We finally got around to it about 10 years ago. We only do two per year because the team that does it is in-house at Hodinkee, so it's our editorial team.

It's something that is really more akin to like a coffee table book than a magazine. Again, the price is $40. The print is incredibly beautiful and tactile, I should say, the stock, the paper. We do 30,000 copies. Advertising here includes Louis Vuitton, Cartier, BMW, Porsche, Rolex, some of the best brands in the world. Those guys still love print, as you may know, and so do we. So we are happy to give them a product that really feels high touch and luxury. The magazine is just a wonderful thing.

Talking Watches. So this is something that I would say, kind of put us on the map. John Mayer reached out to me probably in 2011 saying he was a fan of the site. I thought it was a gag. It was not. We became good friends. He invested in the business, and we launched a series called Talking Watches together in 2013. He is, as many of you know, a big watch collector. This series has gone on to kind of define the culture of watches for the past 13 years.

So Talking Watches, we know because Google told us is, in fact, the most watched piece of content about watches in the history of the world, history of the Internet. So we've seen over 50 million YouTube views, about 0.25 million hours of viewership, and it's been on air for 13 years. Again, as of this year, sadly, for most, it won't be John and Ed hosting. It will be me. But this is a quick little look at what Talking Watches looks like.

[Presentation]

So you saw some of the folks up there, but the names that have been on Talking Watches include Kevin Hart, John Mayer, Ed Sheeran, Jack Nicklaus, the golfer, Aziz Ansari, Kevin Love, the basketball player, Mario Andretti, Brooke Shields, so on and so forth, lots of famous people. Jean Todt, we launched a season with this year. Those of you who might be motorsport fans, there's really nobody bigger than Jean Todt. He's also married to Michelle Yeoh. Alton Brown, Adam Levine.

On the watch side of things, stalwarts like Jean-Claude Biver, legendary kind of watch man from LVMH, Blancpain and elsewhere. Francois Bennahmias, who then became the Global CEO of AP. He's kind of responsible for the growth of AP. We did his last interview, which was with Talking Watches.

And it's amazing to see how much this series has kind of taken on a life of its own. This over here, you guys may have heard of something called the John Mayer Daytona. It's that green dial Daytona. That term was actually coined on Talking Watches with me. So we were shooting Talking Watches 2 with John at his house, and he had this kind of weird Christmassy green dial Daytona.

And it was just kind of an odd in-catalog, weird Daytona that just nobody was paying attention to, and he said, "I really love this thing." And that watch, as David can attest, was sitting at retail for a long, long time. And then all of a sudden, the minute he mentioned it, it became the John Mayer Daytona, and it started trading for 3x retail. And so that is the power of Hodinkee and Talking Watches.

The Hodinkee app, as I said, the Hodinkee app is approaching 10 years old. It allows you to view the content, comment, do the insurance that I mentioned. When we were a retailer, certainly shop. It's an incredibly powerful tool. By our estimation, it is the second most popular watch app in the world behind only Chrono24. I think you guys know what Chrono24 is.

So it's a really robust tool. This tends to be used by the community members, by the power users, and it's something that we will be investing in again. To be frank, it was something that we believed in and invested in heavily from 2016 to 2020. And then as things changed, we got into preowned and we kind of put this on the side. And now via the bosses over here, we will be back investing in the app very soon. So very excited about that.

Just as a test to see how the app may work within the WOS Group, Universal Geneve is a brand that I really love. It's something that, frankly, I could afford when I started Hodinkee unlike pretty much anything else. And now it's being revived by the Breitling house of brands. And with that, we said, "You know what, let's try a preorder run via the app." And so we said, "Hey, just for a few weeks, let's go out and give Hodinkee readers the chance to preorder watches." And by preorder, I mean, you're paying the full amount, the full price. And these are between $15,000 and $30,000 watches, and you'll get the watch in September in some cases. In other cases, next spring. And within a few weeks, we had done about $1 million worth of sales, all via the Hodinkee app and this launch on just Universal.

So again, to show the right way of doing e-commerce with the Hodinkee of today, I think, is what's really compelling. The ambition to do full-scale e-commerce like we did in the past, I don't know that that's there. But when it makes sense to do these special projects like this, it makes -- it feels really good because, again, the support, the fulfillment, all the stuff that Hodinkee was challenged with in the past is handled by Watches of Switzerland, right? So there, you start to see our audience being able to take advantage of and use what already exists within Watches of Switzerland, which is world-class fulfillment and execution of services.

Events, self-explanatory, but we do everything from large-scale multi-hundred person events with people like Spike Lee to small collector dinners with the most famous and wealthy collectors in the world. These are often paid for by brands, but not always We do do a monthly meet up at the SoHo Watches of Switzerland store in New York. It's usually the last Thursday of each month. So you have -- if you happen to be there, come by. It's free. We literally just buy pizza and beer and just talk about watches, and that's it.

So we want everybody to be reminded that whatever happens online, there's somebody behind those usernames. There's somebody behind the website. I think it's really easy when you're an online business to forget about what happens offline. So we want to make sure that, that never happens.

Hodinkee's past and my own history within watches -- excuse me, within the entrepreneurial world. I learned so much, some good, some bad, obviously. But everything we do now, I want to look back at what Hodinkee was able to accomplish and bring it into Hodinkee within Watches of Switzerland.

Two examples. One would be we were funded by some venture capitalists in Silicon Valley led by Kevin Rose here, a buddy of mine. That included backing from Google Ventures, True Ventures, Tony Fadell, if you know who that is, some other well-known names in Silicon Valley. But this allowed us to bring technology in-house. And so we have our own developers. We have our own designers. All the stuff that you see in Hodinkee is made in-house. The CMS is in-house. We do use Shopify, of course, but the app is built in-house. And that technology is something that we're really proud of, and we want to instill within the Watches of Switzerland Group.

On the right there, that's a Swiss newspaper talking about the day that we became the very first authorized dealer of watches on the Internet ever, anywhere in any language. This is 2016 or so. It's a business I still really believe in, and it's something that I think we learned so much from what works and what didn't.

At the time, it was about access. And by access, I mean, if you live in Boise, Idaho and you want access to a Vacheron Constantin, the best way to do it would be buy it on Hodinkee, and we sold Vacheron Constantin online. The luxury market has changed a lot. Now it's about allocation, not necessarily access. But the idea of disrupting things is something that is really important to the Hodinkee culture.

And so now with me, I have to get back to work. So in 2020, The Wall Street Journal wrote this story there with those three far wealthier and handsome -- handsomer guys than me, saying that I was basically stepping down where it says I'll cede the CEO duties after more than a decade at the center of the watch world. And that was, to be honest, a great period in my life. I moved upstate, got married, had kids, became an adult, stuff like that.

And that period was really -- it allowed me to recharge. And when David and Brian approached me and said, "Hey, what do you think about coming back to help us run Hodinkee and work with Watches of Switzerland," I had questions, I had concerns. But more than anything, I was excited because what I really didn't understand even as the watch guy was just how big and impressive of a business Watches of Switzerland is. It has unparalleled access to brands, products and relationships and the likes of which few really realize, including myself.

I used to think that I was the most connected guy in watches genuinely, and that is 100% not true. David and Brian are. There's no question about that. They know people better than I do. They've got stronger relationships than I do. And it's really amazing to see what they've been capable of even before the Hodinkee acquisition happened.

We have an incredible dedicated audience of people that just want to learn about and be around watches and Watches of Switzerland has their own audience. And frankly, these audiences don't really overlap, and that's what's exciting, right? We have the ability and we have the desire to take people that like watches and make them love watches.

Watches of Switzerland has that, too. But we have this way to talk to people every single day, right? If you're a client of Watches of Switzerland, you're probably not getting a text from your sales associate every single day. But if you download the Hodinkee app, you are being contacted by us every day. We're teaching you things. You're learning things, right? Like, you're being entertained. And we really do view this as entertainment, all these under the guise of educating.

So the idea that we're combining these two audiences which didn't exist before and then two cultures. And as you can imagine, Hodinkee's culture was very start-up, the Silicon Valley backed, et cetera, which was dynamic, quick moving, bearing the old adage, which is like, "move fast and break things. We broke a lot of things."

It was, as I say, sometimes kind of really silly. And what I mean by that, it was inefficient. It was led by me, and I'm in my 40s now, but I was a kid when I first raised our first few million dollars. I was in my 20s. And I think the idea that we could build stuff without kind of real traditional financial models, et cetera, was silly. Looking back, it's not the case anymore, obviously.

But with Hodinkee, we wanted to push things really hard. And with Watches of Switzerland, they also want to push things hard, but they're much more disciplined, they're client-centric and they're execution-focused and ensuring that everything is profitable thanks to that man right there. He takes this so seriously.

So the goal here is to combine the best of Hodinkee, which allowed us to become this kind of cultural phenomenon, this really important voice in the watch space, which remains today with Watches of Switzerland, which is one of the largest retail networks in the world. And I think that is really why I'm here. That's why I was so excited to come back to work, frankly, and why I think there's so much left to do within Watches of Switzerland and Hodinkee.

And with that, I will pass it over to Tad to talk about the Deutsch & Deutsch family business.

Good afternoon. I'm Tad Deutsch, and it's a privilege to be here today to share the story of Deutsch & Deutsch. Our company was founded in 1929 by my grandfather. He opened a small store in Laredo. Over nearly a century, the business evolved into one of the premier luxury jewelry and watch retailers in Texas. Today, many of our customers are third and fourth generation families. Those relationships obviously are our greatest asset.

When Watches of Switzerland approached us, we weren't looking for an exit. We're looking for the right long-term partner. As an independent family business, we're proud of what we had built, but we also recognize that luxury retail continues to evolve. Brands increasingly expected investment in new technology, CRM clienteling, digital capabilities and world-class retail environments. We realized that together with Watches of Switzerland, we could preserve everything that Deutsch Deutsch had special but accelerating our future growth. That made the decision very easy.

Today, we operate four luxury showrooms across South Texas: Laredo, McAllen, El Paso and Victoria, Texas. Together, these locations create something much more valuable than our individual stores. They form a regional luxury platform positioned inside one of America's fastest-growing economic corridors. Each market has its own personality, but all benefit from strong popular growth, expanding business investment and decades of customer loyalty.

Thinking about our markets, border communities, we think about the part of one of North America's most important economic regions, South Texas, sits in the center of advanced manufacturing, logistics, aerospace, energy and international commerce. As companies continue investing throughout Texas and Northern Mexico, they create more executives, entrepreneurs, engineers and business owners. Those are exactly the customers who become long-term partners and luxury clients of ours. That's why it's so optimistic about the future.

Texas continues to be one of the most attractive luxury retail markets anywhere in the world with nearly $3 trillion sic [ $2.9 trillion ] of economy, continued corporate relocations, more than 1 million sic [ 1.2 million ] households earning over $200,000 annually and no state income tax, which is really important. Texas continues to create wealth at an extraordinary pace. That aren't -- and these are not temporary trends. These are long-term structural advantages that support luxury retail.

For Watches of Switzerland, Texas remains one of the most compelling growth opportunities in North America. Laredo is the #1 Inland Port in the United States and one of North America's most important trade gateways. Historically, automotive manufacturing is one of the most -- probably the most important, I guess, trade in that area. Today, we're seeing other transformation as artificial intelligence drives investment, data centers and advanced computing, increasing volumes of AI servers, semiconductors and high-performance computing hardware are moving through the North American manufacturing corridor, surpassing automotive and everything else. This growth helps reshape international trade and positioning Laredo as the center of the fastest-growing industrial sector.

McAllen is another market we're incredibly excited about. The Rio Grande Valley is evolving into one of America's most dynamic regional economies. Investment continues accelerating across advanced manufacturing, logistics, health care, aerospace and energy.

One of the most significant developments is the proposed -- or not proposed, it just happened, refinery projected here in Brownsville. If completed or when it is completed, it will represent the first major oil refinery built in the United States in 50 years. The broader economic development surrounding that project has been discussed as representing as much as $300 billion in long-term investment opportunity in South Texas.

Combined with the continued expansion of SpaceX along the Gulf Coast and significant industrial investment throughout the valley, we're witnessing a fundamental transformation of the regional economy. For luxury retail, that's exactly the type of customer base we want to serve.

El Paso completes the South Texas platform. It serves a regional population of more than 3 million people and continues benefiting from manufacturing, logistics, international trade and the Fort Bliss, which is the second largest military base in the United States. Like our markets, it continues growing long-term opportunities for luxury retail. Together, these markets give Watches of Switzerland unique position across one of America's strongest growth regions.

People often ask, what's the biggest challenge of doing this acquisition or partnership? Increasingly, it wasn't our people. It wasn't our customers, and it certainly wasn't our culture. The biggest challenge was integrating the two businesses that had been operating in different technological platforms, as David knows.

Our financial reporting systems, inventory systems and operating processes were very different. During the first several months, both teams worked extremely closely to house these two systems and establish consistent reporting. I'm pleased to say that we successfully ordered and now everything is taken care of. Today, we have stronger reporting, greater visibility into the business and better tools than we've ever had before.

Beyond technology, the integration exceeded our expectations. Approximately 95% of our associates remain with the business. Our relationships with our brand partners has excelled. Most importantly, our customers experienced no disruption throughout the transition.

One thing that impressed our family from the very beginning from Watches of Switzerland was the approach. They didn't ask us to become someone else. They encouraged us to preserve our culture, relationships and our experience that made the Deutsch & Deutsch successful through all these centuries or 1 century.

Watches of Switzerland acquired 88% of our business, essentially allowing me and my brother to run the business like we always have and enjoying the best part of it is being with our customers and not having to worry about administrative work.

At all the same time, we gained access to world-class technology, sophisticated CRMs, capabilities, expanded brand relationships, Rolex-Certified Pre-owned merchandise, greater purchasing power and significant investment opportunities. As an independent retailer, there were natural limits to how quickly we could grow. Together with Watches of Switzerland, these opportunities became much larger.

I'd like to leave you with one final note. When Watches of Switzerland partnered with Deutsch & Deutsch, they didn't simply acquire four successful jewelry stores. They acquired nearly 100 years of customer trust, outstanding management team and a strategic platform for the North America as it's growing at this incredible rate.

Looking back on these past 6 months together, we're even more confident that the partnership was the right decision for our family, our associates, our brand partners, our customers and ultimately, for Watches of Switzerland shareholders. Thank you very much.

Thanks, Tad. That's great. So this is what you've all been waiting for, right? So as we've outlined today, our confidence in the future is underpinned by our unchanged six strategic growth pillars. These pillars have already delivered strong revenue growth to the group, and we see continued opportunity to invest behind them and drive sustained profitable growth.

First, Showroom Investments remains a key pillar of our growth strategy. We have a compelling pipeline of projects, as you've seen, with attractive paybacks that strengthen our market positions and continue to deepen the relationship with our brand partners. We expect to see CapEx remaining at around GBP 60 million to GBP 70 million per year in the midterm, which means it's going to reduce as a percentage of sales.

Certified Pre-Owned has evolved into a meaningful segment of our luxury watch category. We currently operate at around 8% of luxury watches in our overall portfolio, and we target that to get beyond 10% within not-too-distant future.

E-commerce is extending our reach beyond our physical estate and provides a scalable opportunity, particularly in the U.S., where participation remains significantly below U.K. levels.

Luxury Branded Jewelry is becoming an increasingly important growth engine. Roberto Coin enhances our exposure to this fast-growing category with attractive economics. And client experience remains central to our strategy. Through CRM, Xenia and events, we continue to increase engagement and loyalty and lifetime value of our clients. We also introduced Power BI this year, which has given our insight to our customer database in a way that we haven't had in the past actually.

And finally, Acquisitions remains an important potential accelerator. The U.S. market continues to be highly fragmented, which creates opportunity for us. Taken together, these growth pillars support our ambition to continue to deliver sustainable revenue growth, attractive returns and long-term shareholder value.

Our operate -- our operating model is attractive with a cost base that is well positioned to translate to incremental revenues efficiently into profit growth. Product cost represents approximately 73% of our cost base. Importantly, this is a low discount category with supply-constrained products representing a high proportion of our sales.

Then below cost of goods, the majority of our operating expenses are fixed in nature. The U.S., a higher proportion of variable cost in showroom payroll because of the commission structure. The other variable costs represented on this chart is transaction fees predominantly, which are entirely variable.

But beyond that, our costs are either fixed or semi-variable such as marketing. As a result, we benefit from operational leverage as we generate incremental revenue. Alongside growth investments, we continue to improve our operational efficiency across the business.

As you heard from Craig, in the U.K., we have proactively rationalized our showroom network over the last 2 years. The focus has been on consolidating to fewer, larger and more productive locations. Importantly, we've achieved this with very limited sales loss. Much of the reduction has been driven by our mono-brand boutiques, and we're currently successfully managed to transition the majority of this revenue into our multi-brand network. This has, therefore, translated to improved operating leverage across our showrooms.

At the same time, we continued investing in capabilities to support long-term growth in the U.S. Since entering the market in 2017, we have progressively built local infrastructure across leadership, e-commerce, marketing, CRM and support functions. FY '26 represented a particularly important year in this journey, including the investment in management teams, e-commerce capabilities and strategic assets such as Hodinkee. By the way, Hodinkee is not just a U.S. platform. It's actually global. And we have representation in Japan and Australia through various license agreements. So it's a global audience that we're talking to.

And as a result of all of these investments, much of the infrastructure required for our next phase in growth is now in place. The dual running costs associated with building these capabilities are reducing, creating an opportunity for improved efficiency and profit flow-through as revenue continue to expand.

Pre-owned continues to be one of the most attractive opportunities within luxury watches. Today, pre-owned represents approximately 8% of our luxury watch sales, and we're sure we'll get it to 10% within not-too-distant future. Brian referenced the appeal for this category earlier. It's capturing new clients for Watches of Switzerland and driving incremental sales.

In terms of the operating economics, it has a lower product net margin percentage than our primary watch business. But when considering the typical higher selling price, it ends up being broadly cash neutral profit. We see opportunity to improve the margin rate further with improvements in our sourcing and increasing participation of trade-ins from clients as well as improving stock turns. We expect this category to outperform the broader luxury watch segment.

Jewelry represents one of the most compelling opportunities within the group. The U.S. jewelry market remains strong, while the U.K. market is showing encouraging momentum. Consumer trends, including client preference for branded over unbranded jewelry and increasing self-purchase behavior is fueling the category growth.

We're also seeing a great momentum with the lab-grown diamonds, which we introduced in November '25 and now recently in the U.S. a few weeks ago. Roberto Coin provides us with a differentiated position in this attractive category, and we're confident in its potential to grow ahead of our rest of our business.

As Brian covered earlier, we have a clear strategy to drive this growth. We're working with our wholesale partners to expand shop-in-shops, having already proven how well this works in our Mayors Showroom estate. In FY '26, we more than doubled our revenue in these stores. We'll continue to invest behind our marketing and increase our e-commerce reach.

Roberto Coin is financially accretive to our model. It's delivered a strong circa 20% EBIT margin in FY '26, even after a GBP 3.5 million write-off on bad debt. We expect Roberto Coin growth to support group margin expansion.

E-commerce is an increasingly important part of our omnichannel strategy. In the U.K., e-commerce is close to 10% of our revenue and effectively operates as one of our largest stores within the business. It's profitable, scalable and accretive to the U.K. retail model.

In contrast, the U.S. business remains at an early stage of development, accounting for less than 2% of sales in FY '26. Over the last 12 months, we've made significant investments in our U.S. infrastructure, talent and capabilities. And as a result, growth is running materially ahead of the broader business.

Our objective is clear: to build the U.S. e-commerce participation towards U.K. levels over time while simultaneously improving profitability. Because of the infrastructure investment has already been made, future growth should benefit from increasing scale advantages. As the business develops, we expect current margin dilution to reduce and the channel to move progressively towards margin neutrality and beyond.

The strength of our model is reflected in the return we generate on invested capital. Over time, we consistently achieved attractive returns while continuing to invest for growth. Showroom projects typically generate paybacks between 2 and 4 years. Flagship locations deliver similar attractive returns despite larger investments, while acquisitions generally achieve a payback of between 4 and 5 years.

These metrics demonstrate that our growth investments are not speculative. They are supported by established operating capabilities, strong brands, proven execution and disciplined capital allocation. As we continue to deploy capital across our growth pillars, maintaining strong returns remains one of our key objectives.

Our capital allocation priorities remain unchanged. Our first priority is investment in high-return showroom projects. These investments strengthen our market position, enhance our client experience and support our brand partnerships. We expect the annual capital expenditure to be between GBP 60 million and GBP 70 million, as I said, while gradually declining as a percentage of sales.

Our second priority is strategic acquisitions. The U.S. market remains highly fragmented, and we continue to see opportunities to accelerate growth, expand our footprint and add complementary capability. And finally, where cash generation exceeds investment, we will consider returns to shareholders through selective buybacks while maintaining balance sheet flexibility.

Importantly, our growth investments and acquisitions have historically been funded through strong operating cash flow generation. That combination of disciplined investments, strategic flexibility and financial strength gives us the confidence in our ability to continue to create shareholder value.

With that, we are going to open up for Q&A.

Any questions? We'll do the...

Kate Calvert from Investec. Just 2 questions for me. Since you're talking about capital allocation and returning cash to shareholders, we don't have any visibility on sort of when acquisitions might come up and things like that. So I'm wondering if there are any sort of other KPIs we should focus on in terms of when you might make some of these capital returns. A you got any thoughts on that?

I mean I'll answer that question first. So one of the metrics that we always monitor is the return on capital employed. And obviously, piling up cash is going to suppress that metric. So when we need to -- when we hit a level where that drops below what we think is acceptable, we would then consider that as a stronger option. So I hope that answers your questions. We don't have a specific target because, again, it depends on the pipeline of discussions that we have going on and the likelihood of success.

Great. And my second question is just on the U.K. Obviously, margins in the U.K. at the EBIT level have been a lot higher, particularly as we came out of COVID. I'm wondering what your thoughts are about a sustainable U.K. margin? And do you think you can grow that back towards double digits over time?

Yes. I mean, obviously, the year post-COVID were a bit exaggerated because of the pent-up demand that was created as a part of everything being closed down and people sitting with a lot of money and watches became a very hot category during that period. So what we saw was that the non-supply constrained part of our business grew exceptionally strong during those 2 years. And these brands have a better margin profile than some higher density per square foot brands. And as a result, EBIT came through at a very high level.

Yes, I think now that we're back in growth, we've reset our network, and we've taken sort of some really tough decisions, rationalizing down our network to what we think is a better profile of how we should operate. That has been done without really losing any sales, which then translates to operational leverage, as you saw from Craig. And as we now see growth coming back to more of a recognizable pattern historically, yes, we'll see further operational leverage come through in the U.K. business. And as a result, our long-term target would be to get it back into a double-digit profile.

Can you hear me now?

Yes.

So I had 2 questions about the profitability profile of some of the growth initiatives that you talked about. On the lab-grown diamond part of the business of the jewelry, how does it compare on the net margin and also EBIT margin perspective to the rest of the jewelry business and also e-commerce in the U.S.

Is it dilutive to the overall U.S. business at this point, considering it's still a less mature part of your business?

So lab grown is attractive from a margin standpoint. It's a better margin. Jewelry generally is a better margin, as I think you know than watches. And within jewelry, lab grown today is one of the most profitable gross margins, as Craig presented, it's been largely incremental and has really stimulated the category very well. We're getting other benefits to traffic of customers. I think it's been beneficial with the success of lab grown.

E-comm in the U.S. and as presented, we believe will be accretive. We've made investments. We need scale, and we continue to grow. It's growing very, very well. And the plan, of course, is that it will be firstly neutral to profitability is the immediate goal. And thereafter, we would hope that it would be accretive as it is in the U.K.

Alex Simotas with Langdon Partners. The acquisitions in the U.S. I think you had said it was about 68% of AVs are somewhere between 1 to 3 locations. Are we to take that the acquisitions going forward are -- will probably be from that cohort? Or are the larger groups that we are all familiar with also in play?

I wouldn't characterize anything as kind of in play. But with the smaller family businesses, I think a great presentation from Tad as to what a family business deals with the pressures of scale and technology and competitiveness and so on from a size standpoint.

I think the argument on behalf of scale and consolidation is pretty compelling. So that's an obvious target area for us. Just remind everybody that if you're buying Rolex, they're significant from a value standpoint. You could be buying stores that are doing $20 million, $30 million at a time, and they're all meaningful. They're all independent from a logistics standpoint.

Early on, folks like yourself would ask us what's your plan with regards to distribution, logistics hubs and whatever, and it's like no plan. We could keep the stock and a safe in the store. This is high-value, physically small product. So you don't have that logistics challenge overall. So there's a lot of businesses around at the 68% that you referred to the some bigger ones.

We'll say, as we've said continually, we're always in discussion. There a certain pace that we think we should move at that our brand partners are comfortable that we move at. But acquisition remains a core part. It's a core part of what we've created in America, and it remains a core part of our future growth plans.

I think also if you refer back to Dave's presentation that he did, you saw that 1/3 or so of our business came through acquisition. The assets that we've acquired, typically, the combination of the 2 businesses brings additional acceleration in growth because we can bring some benefit and allow business partners to focus on what they should focus on.

So I think there is a win-win in that sense. So that portion of the business tends to drive faster growth actually.

I love what Tad had to say earlier that he and his brother can do what they love dealing with customers and dealing with product, and we can provide systems and scale and cyber protection and all the things that we can do at scale that we do day in, day out. That's a perfect example of the benefits.

Eduardo Tricio at Trigo Capital. So I had a question on the ability to grow organically given the supply constraint part of the business. So when we see the organic growth CapEx for the store expansions, the client experience and new stores.

How much or how supply constrained could that growth be?

I mean there is a very positive thing about our business is supply constrained and therefore, the ease of selling, if you like, a great deal of our sales still go to people who have been waiting patiently for the product.

So that's the benefit of it. And to your point, the frustration of it is you can't increase as quickly as you would like to, but it's a real strength of our business. And we continue to do everything we can to get better supply, of course, investing in beautiful stores, having great sell-through, having great client experience, all that really helps in those discussions.

Acquisitions they will help. And again, when we're making an acquisition, we can talk about investment, we can talk about development. But across our business, I think as you heard from David and Craig. We really are in the best shape we've ever been in the U.S. business has really grown, fully resourced, nice offices, nice facilities, nice service centers and great management out in our showrooms and performing very well, constantly measured by us, constantly measured by our partners doing mystery shops and so on.

And similarly, in the U.K., the way the organization has developed, Craig has made a lot of changes. The way we've rationalized the portfolio, really given us a concentration on the stores that are profitable and have growth potential. I think we're at a very, very good inflection point in terms of our organic growth and on top of which we carry on with all these growth initiatives against, I think, a very, very solid and improving base.

This is Karen from Lloyds Bank. I have 2 questions specifically about Rolex. I'm wondering if Rolex is still a big part of Watches of Switzerland sales given all the acquisitions of different jewelry companies now?

And also, for example, the acquisition of Deutsch & Deutsch and other smaller resellers, how does that change your relationship with Rolex? Would you get more allocations, better allocations, closer relationship because of these acquisitions?

Well, Rolex remains half of our business. It is our biggest partner. They're the biggest player in their markets. They are around 40% of the luxury market, U.K., U.S. They're over 50% of our business. So we over-index on Rolex.

Rolex and all the brands have change of control clauses. So we would discuss and advance any acquisitions that we would make. And Rolex have been supportive of the acquisitions that David presented, all of them or they wouldn't happen Mayors and Betteridge and through to the most recent Deutsche & Deutsche.

And we'll discuss together with them. They like this format that we've done of the family remaining equity holders that really gives them a comfort that the transition and the management of the client relations and the management of the teams and so on, will all be maintained while we can bring the benefits of our scale and corporate resources.

So they're very positive about that, and they were clearly aware of it, supportive of it, approved of it. Immediately, the allocation that Deutsch & Deutsche have becomes part of our group allocation and becomes part of the arm wrestle that we have on an annual basis and not more frequently about allocation. And clearly, we do well ultimately on that arm wrestle. We've grown our Rolex business over the years at a much faster pace than we've grown the total. And it's the bedrock of our business still.

Having said all of which, the other businesses are growing very well, too, as you've heard. And I think coming out of this period of volatility, the success that we've had in pre-owned and the success that we've had in e-com, the success that we're now enjoying in jewelry is all great and all just adds further momentum, I think, to the growth that we can enjoy

. But there will never be a time that somebody stands here and says that Rolex is not important to Watches of Switzerland. It clearly is a critical partnership, but a very, very strong one. I don't think it's ever been stronger.

Zuzanna Pusz from UBS. I have 2 questions. So maybe first of all, on the Roberto Coin acquisition, would you be able to share with us maybe sort of your key learnings about the category? Anything that, I guess, surprised you since you've been operating the business?

And secondly, on M&A, I mean, do you -- are you happy with the mix of the business now? Obviously, you outlined today which parts of it you expect to grow faster. But in terms of your M&A, are you going to now solely focus on some bolt-ons when it comes to distribution in the U.S.?

Or if some opportunities in jewelry arise again, is this something you'd be willing to consider at some point given the experience with Roberto Coin.

Yes. I mean taking the second question first. I think by all means, we got to appreciate the Roberto Coin brand from having it in our Mayors stores. It was doing very, very well. We got to know the team, particularly in the U.S. We didn't know the team in Italy initially. But it was a success of the brand in our stores that got us very positive about it.

We then learned that there was some interest in it being sold, the rights in the U.S. and then David started a negotiation with Peter that eventually to us buying the business.

I think what we learned, I mean, I think we really understand better now than we did previously, just how great the American market is in jewelry. American women love jewelry. They're buying it for themselves. They're collecting, they're accessorizing.

So it really is a fantastic category. I think we knew in buying the business that Roberto Coin is about great product, not about great brand investment or brand elevation. It was entirely wholesale distribution, which will change. But having said that, the wholesale distribution is fantastic. There's a great love of the brand and the distribution that's out there.

Peter Webster has really managed a very great development of partnership overall. They have so much product. I think that's been a learning. They're so prolific in product development, and that's our strength. But on the other hand, we don't have iconic success stories that you really build a business, so on like love bracelets or a [ indiscernible ] from Van Cleef.

So a lot of things there that we're going to work on and we are working on with them, but it's a fabulous business in a great market. Did I answer everything there? It looks as though I didn't.

Oh yes. I mean, if there's other opportunities like that, the team that are distributing the brand, selling a brand around the country are fantastic at what they do. Could they handle others? Yes. Are we actively looking at the moment? No, we don't have any specific, but there is potential that sales organization is very, very valuable.

Piral from RBC. So 2 quick questions, please. Thank you for providing all the building blocks around CapEx and all the detail around that. What you've given us in the past is also a component around acquisition CapEx.

Is that something you have an idea of in terms of numbers going forward? And is that something you could share with us, please?

We don't exactly know. And it's probably the most difficult thing to project how much it's going to be -- I think we made good progress about what we said a couple of years ago. We spent a lot, and we've done great.

It's not that easy to say it's going to happen in sort of 6 months, 12 months. For sure, it will happen. But within what time frame, it's really difficult to say actually. So I'd refrain from giving a number on it. And most of you guys anyway don't model it into your models. So I don't think it's that relevant given the audience I'm talking to.

I look at our history, we've been a decade rather than us just coming up with an estimate.

And just quickly, housekeeping, but will you make this presentation available?

Yes. YouTube, what we want tomorrow. Any other questions? Do you have one?

So we've got one on the webcast, just asking if you can give some more color on the shape of the e-commerce business. Any particular products or brands that do particularly well online and where you see opportunity?

You guys want to take have a good e-com business, do you want to answer this?

It largely follows the same pattern as our showrooms. It's not so dissimilar. I'm still mic, right? It's not so dissimilar from our showrooms. Strategic partner brands, the 5 or the 8 that we talk about all the time, Mega Cartier, very significant online. Our CPO has become -- pre-owned in general has become very big over the last 12, 18 months. Of course, the big advantage online is we've got 1,300 as an example, 1,300 pre-owned Rolex watches at this moment in time in stock. In a showroom, you might find 50 of them online, you'll find all 1,300 of them, and they can be delivered pretty much the next day.

So our advantage is next-day delivery, great client experience, virtual boutique, as you've seen, 30,000 SKUs to choose from and a really high level of service. So our e-com business can sell anything, actually is the truth from GBP 100 drinkware to a GBP 50,000 [indiscernible] preowned. It's all there to be had.

I think another observation on our e-com business, a, Rolex and Patek, you could just take that away because these brands are not transactional, as you heard earlier today. So that sort of disqualifies 50% of your revenue. And I said it's 10% of our business in the U.K. that is online, right. Which means that it's 20% of the balance. So it's really significant if you think about it that way.

The other factor that distinguish e-commerce is also that it has a higher penetration of jewelry than the balance of our network. So as a result, I talked about profit accretive, the U.K. business. The mix of that consumer that goes online is more sort of gender agnostic, if you want to call it that. So in a watch store, you have more mail traffic. In a watch and jewelry store, you have more mixed gender as we do online. So actually, jewelry is outperforming our overall average online as well.

And I think it's fair to say by brand, the average selling price is a bit less online, more steel, a bit less gold and whatever, but it's still very much a luxury.

Yes. And it's really supported by brands that are have less distribution. So Cartier that has only 40 plus, 42 points of sale in the U.K. is a much higher penetration online with us than maybe TAG Heuer would be that's got near 200 points of sale. And just one thing on Rolex, just to say there is no purchase of Rolex online, but the virtual boutique deals with around about 1,500 inquiries a month, which come via our website to our virtual boutique team who then arrange for appointments.

So it's that whole kind of ecosystem that I was referring to before, that kind of full omnichannel approach that plays its part, even though it doesn't retail Rolex products yet.

The other thing that comes with scale in the e-com space is the data itself, right? So once you reach a certain critical level of traffic, Google gives you special treatment and insight to sort of the traffic data, which is very valuable because it can actually link to also store performance, who's clicked on an item came to the store via geotargeting and so forth.

So you can see what kind of footfall is actually directly correlated to traffic online. So it's that omnichannel proposition that Craig alluded to. And that drives a lot of our marketing decisions into this channel because you can target your ROAS quite scientifically actually. How much do you actually want to invest in spend behind the traffic and as a result, look at the return. So scale is important.

Yes. Just you have all got us all excited about e-com, a lot of answers coming. But I don't know whether Craig presented web-enabled sales, which is the mechanism whereby all of our stores can access all the product anywhere in our network. and how they do it with customers then when a customer says in a store that doesn't have Cartier, we have Cartier in our network and we present it and they make the sale effectively from their iPad that's been designed to be customer-facing.

The product -- they do the transaction there and then the product arrives the next day, we adjust the base and so on. So it's a very, very nice part of our business. It's very incremental. We don't include it in the online sales. it's technically online, but the transaction kind of happened in the store. We give the store the credit. But our online even bigger if we were to include web-enabled in that mix.

Camilla Eling from Nedland General. My question was around the store rationalizations in the U.K. So have you done enough there? Or is there a lot further to go? And just on that, some context around the -- if you look at stores on an individual basis, how many of them would be more of that breakeven point?

Yes. So I don't know if you've seen the numbers. We went from 158 showrooms down to 118 as planned for the fiscal year '27 end. I would say in a deliberate sense, it's complete. The ones that we went after very deliberately say we don't want to be in that particular location. We don't want to be in that town or if we close that TAG Heuer boutique, we can move the TAG Heuer agency into a multi-brand. All of that is pretty much complete.

I would say there's probably another 10% or so of showrooms that when they come to the end of lease, we'll consider as we will any other business to say, do we want to then go and spend capital, putting that into its kind of luxury state. If we don't, then we'll consider it, we'll discuss it as a team and maybe we'll close it. And if we don't close it, we'll invest in it. So but I wouldn't say we'll get much lower than the 118, let's say.

I don't think we're going to see the number that we've seen in the last 2 years because it was predominantly mono-brand stores and some depending on those tertiary brands that didn't meet the thresholds and as such, dropped out, and we put the sales back into our multi-brands.

So the significance of it will not be the same going forward because I think we've sort of cut most of it behind us. So it was 2 big batches last year.

And it was a consequence of the post-COVID period when sales prices went up, volumes went down and what looked like very viable propositions 2 years before no longer were -- and so we make our decisions.

I would just say you may see a few others as well that aren't essentially closures. In some shopping malls, we may have 4 premises in there, and we might just decide to expand the Goldsmith to 5,000 square feet instead of 3,000 and then bring all the brands back under one roof.

It's effectively a closure in that situation, but you're not closing the brands, you're just taking them all under one lease. So there might be a...

That's a lot of activity. I mean for any 2 that we consolidate, we might be opening a store somewhere, that's normal. The last couple of years was abnormal because of the impact of what happened during this volatile period, and that's done. normal collections done.

So just last one on Hodinkee and the potential for any plans to further monetize or leverage that platform? How are you thinking about that?

I got a great presentation from Ben. It's a phenomenal success story that Ben's created. It's unique within the world of luxury watches. There is so much more potential to come. We keep talking about. There's a lot we're already working on of limited edition watches of monetizing VIP of effectively monetizing the traffic that goes into Hodinkee through our commercial operations. So there's so much more to come that we're working on. The priority upfront has been to reestablish the great reputation of Hodinkee and the momentum to invest again in the editorial team to get Ben doing back what got intended them to do and run that Hodinkee business. You heard the enthusiasm that he's built the business. That's what we've been doing.

The app is a big investment that we're making, and it's going to be the key center of the ecosystem that's there. So I think a lot to come from Hodinkee.

So thanks, everybody, for coming for your questions. I hope that answers most of your questions, the presentation, your questions since we're having drinks across in the Broadgate store. It's probably 300 yards away, and it's a free drink. So we expect to see all of you there. But if we don't see you there, nice to see you all here. We do see you there, then we'll look forward to having a drink together. Thanks all of our presenters. Thank you.

Good morning, everyone. Thank you for joining our presentation. We will be reasonably brief this morning, focusing on fiscal year '26 results ahead of hosting a more in-depth presentation on our growth strategies this afternoon. You'll be hearing firstly from me, Brian Duffy, Group CEO. I'll be taking you through some highlights for the year and performance against our growth pillars. I'll then hand over to Anders Romberg, our Group CFO. He will take you through the numbers in more detail before we open up, as usual, for your questions.

Fiscal year '26 was a year of strong execution against what was a complex and changeable operating backdrop. The growth our teams managed to deliver while navigating headwinds from tariffs, gold pricing, margin changes and ongoing consumer pressure in the U.K. is a testament to their drive and capabilities. So our top line numbers, sales for the year of GBP 1.828 billion, up 13% on last year in constant currency. The U.S. was plus 24% in constant currency, which saw it become our largest revenue and profits market, and the U.K. was plus 5% on last year. Encouragingly, we saw an improving trend over the course of the year with H2 at plus 17% constant currency ahead of the plus 10% delivered in H1. Adjusted EBIT grew 6% in constant currency to GBP 155 million and statutory PBT of GBP 133 million was up an impressive 75% year-on-year.

Turning to our growth drivers. We will talk about these focus areas in more detail this afternoon. But for now, I'd like to share some of the highlights from fiscal '26. We invested GBP 66 million into our showroom estate during the year, completing 13 major projects. We were also very pleased to complete the acquisition of Deutsch & Deutsch in January. This is a fantastic addition to our business, showrooms, which have a well-established presence and client relationships in 4 Texas locations as well as long-standing partnerships with leading watch and jewelry brands. Tad Deutsch of Deutsch & Deutsch will join us this afternoon to talk about the business and his experience of joining the Watches of Switzerland Group.

Pre-owned continued to perform well, up 22% year-on-year with good growth in both the U.K. and the U.S. In luxury branded jewelry, Roberto Coin performed very well at plus 20%. We saw sales through our Mayors boutiques more than double following the upgraded shop-in-shop installations. We've had a good success with our launch of lab-grown diamonds. The product is trading really well in the U.K., and we have now launched in the U.S.

Ecommerce also had a good year in both markets with growth outpacing the overall group at plus 21%. We launched a new upgraded Hodinkee app during the year with a shop option through to Watches of Switzerland. Ben Clymer, Founder of Hodinkee, will also be joining us this afternoon to present the Hodinkee story and growth strategy.

As I mentioned earlier, looking at the geographic split of our sales, the U.S. surpassed the U.K. in fiscal year '26 as our largest market by revenue, reaching 51% of group share. Our group sales remain very much domestic driven, 95% in fiscal year '26 with very little international business since VAT-free shopping was removed in the U.K. following Brexit implementation in 2021.

So altogether, FY '26 was a record year for our group. Our revenue CAGR between fiscal year '15 and '26 is 15.5%, and we saw adjusted EBIT increase despite the volatility in the year. Our balance sheet remains healthy. Net debt reduced to GBP 56 million during the year, and our ROCE was a robust 18%.

Focusing on highlights from the U.S. market, fiscal year '26 constant currency growth increased to 24% with an acceleration during H2 to 27%. Growth was broad-based, led by strong underlying demand, outperformance of Roberto Coin, e-com and pre-owned, our showroom investments and contribution from the acquisition of Deutsch & Deutsch. We're pleased to have carried this good momentum into the new financial year.

Key projects for the year included a new Watches of Switzerland in Minneapolis, 2 relocations in Georgia and Florida as well as 3 Roberto Coin mono-brand boutiques. We have also developed our growth strategies and plans for Roberto Coin and Hodinkee, which we will discuss further this afternoon.

A bit more detail on our acquisition of Deutsch & Deutsch. We have adopted a new acquisition model here, which sees the former owners, the Deutsch family retain a 12% ownership, something we believe works well from all perspectives. We are pleased to have Tad and Aladar Deutsch remaining in the leadership of the business. They are great operators and bring fantastic local knowledge of the market and long-standing client relationships. The integration has been very positive, and we are delighted to have added 60 Deutsch & Deutsch colleagues to our team.

Turning to the U.K. Growth in fiscal year '26 was solid at plus 5%, which was a good result against a somewhat subdued market backdrop. Trading improved over the course of the year, and we believe the market is now showing encouraging signs of improvement, which is great to see. We completed 7 key projects during the year. Highlights include the expansion and refurbishment of Mappin & Webb in Birmingham and refurbishment of the first-ever Rolex agency in the U.K., Northern Goldsmiths in Newcastle.

We had our first full year of trading at Rolex Old Bond Street, having opened at the end of fiscal year '25. The showroom performed brilliantly ahead of plan with strong client feedback, including a very high NPS of 93. We have taken the learnings from this great client experience and included these learnings in all of our training programs.

With that, I'll hand over to Anders to talk through the financials in more detail.

Thank you, Brian. FY '26 delivered a record year of sales and strong momentum in the U.S. market and a robust U.K. performance. Sales came in at GBP 1.828 billion or plus 13% at constant currency versus last year. The sales growth was driven by the U.S. market with growth of 25% in constant currency. Our adjusted EBIT came in at GBP 155 million versus GBP 150 million in FY '25 or plus 6% in constant currency, with adjusted EBIT margin of 8.5%, down 60 basis points versus prior year. Our free cash flow was GBP 162 million and return on capital employed was 18%.

On to the income statement. This is presented on a pre-IFRS 16 basis and excludes exceptional items. The reconciliations to the statutory numbers are included in the RNS. Net sales was up 13% versus last year in constant currency or 11% at reported rates, driven by strong U.S. performance. Net product margin was 70 basis points down versus last year, reflecting adverse product mix and a reduction in brand margins due to U.S. tariffs and significant increases in gold prices. Our adjusted EBIT was GBP 155 million or plus 6% compared to last year at constant currency or 3% in reported. This gave an adjusted EBIT margin of 8.5%, down 60 basis points to last year due to the net margin decline, as just mentioned, and a one-off debt write-off in Roberto Coin. This was partially offset by leveraging showroom costs and overheads. The effective tax rate was 26.7%, a reduction on last year, driven by a one-off tax credit on Roberto Coin. Adjusted EPS came in at 45.2p, an increase of 9%.

Looking at the breakdown of sales, the U.S. was the biggest growth driver. U.S. retail was up 25% in constant currency with robust demand across brands and categories, supported by the expansion of our showroom network. We're pleased with the performance of Roberto Coin wholesale with sales growth of 22% in constant currency. There's been a positive market response to the new products and the advertising campaign launched at the start of the year. Within our Mayors network, Roberto Coin sales more than doubled following upgraded shop-in-shop presentations.

U.K. and Europe sales grew by 4% with 5% U.K. growth, excluding the closure of our European showrooms. Continued demand for luxury watches and improving momentum in luxury jewelry in the second half drove the growth. Across both markets, our e-com business continued to do well and grew by 21% in constant currency. Our pre-owned business grew by 22% in the year.

Adjusted EBIT came in at GBP 155 million or plus 6% on last year at constant currency. Adjusted EBIT margin was 8.5%, which was 60 basis points down to prior year due to product margin rate decline, partially offset by leverage of fixed cost. The U.S., including Roberto Coin wholesale is the major growth area and 51% of group sales represents 62% of adjusted EBIT.

U.S. retail had product margin contraction due to U.S. tariffs, but this was offset by leveraging on the cost base. The year was also impacted by investments behind our ecommerce business and Hodinkee. We expect these investments to start delivering benefits in FY '27 and beyond. In the U.K., product margin was impacted by adverse product mix with limited leverage on the cost base. We focused on cost control and store profitability and made good progress during the year. Roberto Coin wholesale EBIT margin was impacted by one-off department store debtor write-off and the investment behind our marketing campaign with Dakota Johnson.

Our balance sheet is strong. In the year, we spent GBP 39 million on acquisitions made up of our purchase of Deutsch & Deutsch and the final payment for Roberto Coin. Continued capital investments in our estate to elevate the network and drive future growth remains a key component of our growth strategy. Inventory levels were up 2% with continued improvement in underlying stock terms. Average unit cost of stock increased in the year, reflecting increased gold prices and U.S. tariffs.

Underlying inventory was flat year-on-year, and the increase came from the acquisitions of Deutsch & Deutsch. As a reminder, inventory is a very low-risk asset in our category. We closed the year with a net debt position of GBP 57 million. Our net debt-to-EBITDA leverage came out at 0.3x. We continue to be highly cash generative.

Our free cash flow for the year was GBP 162 million with a cash flow conversion of 80%. Last year was adversely impacted due to an increase in working capital as a result of change in payment terms from some of our key suppliers. In Q1, we completed the announced GBP 25 million share buyback program with GBP 14 million spent during FY '26. The full year net cash inflow was GBP 38 million.

Our guidance for FY '27 is based on a 52-week trading period versus 53 weeks in FY '26. It's also based on visibility of supply of key brands for the calendar year of '26. The guidance reflects confirmed showroom projects, but excludes uncommitted capital projects and acquisitions. So we're guiding towards revenue growth in constant currency of between 5% and 10%. We expect our adjusted EBIT margin percentage to expand by between 40 and 80 basis points, and our capital expenditure for the year will be between GBP 60 million and GBP 70 million.

With that, I will now hand over to Brian for some final remarks.

Thanks, Anders. So I'll just summarize before we open up the Q&A. I'm extremely proud of the performance our teams delivered against what was a very complex and changeable operating backdrop. We made strong progress against each of our strategic pillars, and we look forward to sharing a bit more detail on those this afternoon. We've started the new year well. Trading is encouraging in the first 10 weeks with continued strong momentum in the U.S. and in the U.K. looking to return to more normalized growth market conditions. We confirm our previous guidance.

Just before we open up to Q&A, if I could ask you to focus your questions on fiscal year '26 performance, and we will be more than happy to take questions on the broader strategy this afternoon.

Operator, can we please open up to your questions.

[Operator Instructions]

Now take our first question from Zuzanna Pusz of UBS.

I just have 2. Maybe the first question on current trading. I mean the press release sounds quite positive. You say that there are encouraging signs of improvement in the U.K., and it sounds like the U.S. sort of the momentum is also continuing. But I'll be just curious if you could give us maybe some extra color. I understand it's still early point in the year, but maybe just for us to understand sort of if we are trending more towards the upper end of your outlook or anything incremental, if you put that, that would be helpful.

And then secondly, just a very quick question, given that the U.S. is obviously becoming a much bigger part of your business and especially profit. Can you maybe remind us if there's any rule of thumb we should be aware of when it comes to the impact of the U.S. dollar? I mean, I know that the outlook has been confirmed at 1.34 rate, but just something to keep in mind in case you were to see any FX volatility.

Zuzanna, thanks for your questions. We don't have a lot to add in current trading. The way you summarize it is right on the U.K. performance is good and improving as it has been steadily through H2 last year continued into the first quarter of fiscal '27 and the U.S. has remained strong. We're ahead of what we assumed in the guidance for the first quarter, but not substantially enough to change anything. We're conscious it's only 10 weeks, of course. We have some favorable intake of product, which we think is most likely timing, and we'll probably see that reverse in the balance of the year up against tougher comps, and there's a lot of uncertainty still out there from a macro standpoint.

So clearly, a lot to go, but an encouraging start.

We've described it as that certainly feels I think your second point is a good one on dollar. Year-on-year, last year reported was not as good as constant with the dollar weakness. Year-on-year, the situation is much more comparable. So there wouldn't be a loss running at a slight gain at the moment. But again, we'll see what the dollar does. But obviously, our dollar-denominated profits are more than half of our profitability overall, the exchange rate is important and a bit of favorability on that so far, but we'll wait and see how things develop for the year.

Sensitivity-wise, a GBP 0.05 movement on the dollar is worth around GBP 30 million in sales and GBP 4.5 million in EBIT.

We'll now take our next question from Adrien Duverger of Goldman Sachs.

My first question would be on the certified pre-owned business. So relative to your midterm target, how is the Rolex CPO progressing? And what are you learning in terms of customer reception? I think in the U.S., you already have CPO in all of the stores except and how is the progress in the U.K.

And my second question would be on your full year '27 guidance, especially with regards to the adjusted EBIT margin to be up 40 to 80 bps. Could you please help us with the different building blocks in place there?

Thanks, Adrien. I'll take the first one on CPO and Anders can comment on EBIT trends. We -- going forward, we are going to be reporting CPO as a category. We've had a very good experience. Clearly, Rolex certified pre-owned was a major catalyst for us getting seriously into the pre-owned market, building our resources, building our capabilities, building our expertise.

But the benefit alongside Rolex has been a meaningful uptake in other brands CPO. So we'll be looking at it as a total category. It's now over 8% of our business. It was less than 2% and we started out in fiscal '19. So it was never a big deal for us in the past, but it clearly has become that now. It's really great to see our team's expertise and confidence and everything grow. The training that we're doing with our salespeople. It's a different enough selling experience new versus pre-owned that really requires specialized training, which we're doing, also developing marketing, window presentations, [digital] activities. So a lot going on. It's now a really meaningful part of our portfolio now. It's an area where it's a segment where scale and resources such as we have really does give a competitive advantage.

Rolex CPO in your question, we're in every Rolex agency in the U.S., not yet in the U.K., but it's a matter of just store design, store changes that are happening and as they happen, for example, the Rolex boutique that we're opening in Glasgow, my hometown relatively soon. Then we'll introduce CPO at that point given the doubling of space that we're going to have up there. So we will be rolling it out to other Rolex agencies. We will be expanding. We're allocating more space to preowned generally, U.K. and U.S. since it's really proven to be a valuable category for us.

Adrien, your question on margin, obviously, we had a one-off write-off going through in FY '26 as disclosed, GBP 3.5 million of bad debt provision that we had to take. The balance of it is going to come through operational leverage.

[Operator Instructions]

We will now move on to our next question from Piral Dadhania of RBC.

I just had one technical question, if I may. So I think that your EBIT margin was impacted negatively by the write-off of a debtor balance, which we assume to be SAC's. And if our understanding is correct, the amount is in the region of about 7 million. My question is as follows. Is that GBP 7 million included as an adjusting item against your EBIT -- your adjusted EBIT of GBP 155 million because we can't find that in the Note 4 of the release? Or have you included that within adjusted EBIT, which means that the underlying EBIT margin, excluding that write-off would actually be roughly 40 basis points higher?

So thanks for the question. It's not GBP 7 million. It's GBP 3.5 million. Your assumption on SAC is correct, and it is included in the reported adjusted EBIT. It's not regarded as an exceptional item.

Okay. So that means that -- so our number was wrong, but directionally, does that mean that if we took that out, then actually the starting point for the '26 margin would actually be slightly higher?

Correct.

And we will now take our next question from Kate Calvert of Investec Bank.

I just got a question on Roberto Coin. I was wondering if you could just talk about how much churn there has been in the network since your acquisition and how that was versus your expectation? And also, you highlighted the fact that the new collections have gone down quite well with your wholesale partners and also your own customers. Was there any shortage there? Or were you sort of pretty happy with the stock flow that came through?

There's literally been no churn in the customer base. On the contrary, I think there's been a positive reaction to us as owners in terms of the resources. Obviously, we immediately started with investment behind the brand with the Dakota Johnson campaign. I would add that David Hurley and his team have got a great reputation in the U.S. We know obviously, a lot of these watch and jewelry retailers through trade events and so on.

And really, we had anticipated that we may have lost a couple of customers along the way just because we were a competitor and now a supplier. But honestly, there's been nothing. And as we present this afternoon was actually a positive response from wholesale customers to the plan that we have for elevating the brand and expanding the space.

With production, we have great interaction with the teams in Vicenza. They have added to their capacity locally with the expansion of the factoring capabilities. So we've had no issue with supply. We don't anticipate any. Obviously, we're giving the team the best information we can about our forecasts and potential and plans. We great deal with them honestly, on a weekly basis, more often than once a week, we're interacting. So we don't have any concerns about supplying the growth that we plan.

And we will now take our next question from Jon Cox of Kepler.

Brian, I have to ask you, these the reports in Reuters about you guys being approached. Any comment on that at all?

No, we don't comment on speculative media reports.

Okay. Just on Rolex, you talked about potentially got more product than you anticipated at the start of this financial year. Just looking at the pricing, I think there were some price increases announced but not a lot in June. With everything that's gone on with the tariffs and gold prices coming down, just wondering what your thoughts are on pricing for the current financial year.

Yes. Our view is -- and again, we never include the speculative pricing in any of our guidance at all pricing normally happens in January, but can happen at other times when various things happen like the gold pricing recently, like Brexit when it happened, the exchange rate went down, there was a lot of midyear increases. But normally, it's January. The industry have a lot to deal with, with gold pricing, with inflation, inflationary cost and with a strong Swiss franc and then the remaining tariffs in the U.S. They have adjusted pricing a bit more than average.

If you look back at this year, the year gone by, we think there's still a bit more that they may want to do. But honestly, your guess is as really good as ours as to how the brands will feel about pricing and any pressure that they might be putting on volume. So we'll wait and see. We haven't included anything as usual. Our guess is maybe a little bit more than historical average, but it really is a guess at this point.

I wonder if you could just give us a bit of commentary or color on sort of brand momentum in terms of -- I remember a year or so ago, you're talking about some of the brands that sort of adjusted price points because of what happened, particularly in the U.K. and some had. And just wondering about overall, you've talked, I think, about Cartier being good momentum and some of the other brands.

Yes. I think the really pleasing thing about what we're experiencing at the moment is it's really broad-based. The encouraging trends that we're seeing U.K. and U.S. is similar in that sense. The new products that were introduced that Watches and Wonders, we think are very smartly considered from a commercial standpoint, a lot of innovation, a lot of innovation in color and appeal and clearly a consciousness of a price point, which is very important for the U.K. market.

We have -- one of the big benefits of being multi-brand is we are, we can make some changes over time to our brand mix, which we've done. So for example, a brand like Longines with us is doing very well, really good product development and an attractive price point in both markets. But obviously, other brands, Cartier continues to be very strong. OMEGA doing well with us and TUDOR doing very well. So it's very broad-based overall.

We're also very encouraged by the trend that we're experiencing on the preowned that we've commented on already. E-com is making a disproportionate contribution and some brands are stronger there than they may be in store. And jewelry, clearly doing very well. Roberto Coin doing well, lab-grown really making an incremental contribution. So pleased to say that it's not focused on one brand or one market. It really is broad-based, which is pretty encouraging.

With no further questions on the line, I will now hand it back to the management team for closing remarks.

Is there any other questions that's come in online that we should?

We have one from Melania at BNP, just asking about whether the 2 new Rolex production facilities in Switzerland are working? And do we have an expectation that we might benefit from increased allocation, thanks to this additional production capacity coming online?

The new facility that Melania is referring to Rolex announced a couple of years ago in Biel in Switzerland in the Jura Mountains. It is a big investment and it's not expected to come online. I don't think until late '28, '29. We don't know any more than that at this point. It's speculative what will happen on production. We know that some production will be relocated. We know that there might be a reduction in what has been for Switzerland, some excessive working hours and so on, including weekends and that sort of thing.

So we really don't know, but we do know that it's -- the building is pretty much done. It will be typically, I'm sure, a state-of-the-art production facility. I really look forward to seeing it, but we wouldn't -- and we haven't built in any expectation of what that might result in terms of production and availability at this point.

That is it from the webcast question.

Okay. Well, thanks, everybody, for joining us. Hopefully, see many of you this afternoon when we'll present our view of the future in more detail. '26 was, I mean, clearly a good year for us in terms of sales growth and in terms of developing our infrastructure and our portfolio of brands and stores.

Our teams -- I'm really proud of what the teams have done in '26 and the previous years with some of the changing conditions that they've had to deal with and deliver at the end of the day, some very good numbers. I really proud and pleased that we're also able to continue to support our foundation throughout that period. It's something that myself and our whole team feel very, very proud of.

'27, as we've been discussing, has started well, allows us to kind of confidently confirm our guidance, no more than that at this point. But so far, so good. And we'll look forward to updating many of you, if not all of you this afternoon. So thank you for joining us.

Good morning, and welcome to the Watches of Switzerland Group's FY '26 Trading Update Webcast. We are joined this morning by Brian Duffy, Chief Executive Officer; and Anders Romberg, Chief Financial Officer. [Operator Instructions] I'll now hand over to the Watches of Switzerland Group management team, Brian Duffy. Please proceed.

Thank you, Dom, and good morning, everyone. Thanks for joining our full year fiscal '26 trading update call. A few introductory comments from me, and then we'll open the line for your questions for myself and Anders. Our group sales coming in at plus 13% in constant currency, plus 11% in reported, a total of GBP 1.83 billion, well ahead of the high point of our guidance and our market consensus. H2 growth trends were marginally better than H1 despite being up against tougher comps. We expect adjusted EBITDA of between GBP 152 million and GBP 155 million, also ahead of expectations. Our team delivered great results navigating through challenges, including changing import tariffs, gold price inflation, some other challenges. They really did a great job.

Sales in the U.S. of GBP 1.24 billion, were 24% up on prior year, and the U.S. is now more than 50% of group sales. This is a major milestone for our group achieved in just 8 years since we entered that market. The U.S. luxury watch market is the largest and fastest-growing major market globally, and we continue to see the market as underdeveloped. The high-income segment in the U.S. has benefited from significant increases in wealth due mainly to the appreciation of financial assets and the luxury watch market in the U.S. is buoyant. The U.S. luxury jewelry market is also the #1 market globally, and our Roberto Coin wholesale business has shown great sales progress of plus 22% in USD for the year. Roberto Coin brand performed very well in our Mayors stores in Florida and the 3 new mono brands and new website all performing in line with our expectations.

Our acquisition of the Deutsch & Deutsch 4 stores in Texas has proceeded well, and the business is performing well, too. In the U.K., sales have improved in H2, and we continue to view the U.K. luxury market as stable. Sales for the year were plus 5%, and we had a particularly stronger year for luxury jewelry. Looking ahead to fiscal year '27, we're carrying in strong momentum and good confidence into the year. Our guidance is for sales growth of between 5% and 10% in constant currency. That is, of course, 52 weeks on prior year of 53. If we adjust for that, the guidance we're giving is between 7% and 12%.

And we're getting to a profitability improvement of between 40 and 80 bps compared to fiscal year '26. Our growth pillars are all performing well, and we have a strong pipeline of projects. In the U.K. and U.S., we look forward to another year of record growth. Many thanks to our wonderful colleagues for showing, again, their commitment and enthusiasm, excellent client service and delivering these strong results for fiscal year '26. So with that, we'll open the line for your questions.

[Operator Instructions] We'll take our first question from Chris Huang from UBS.

It's Chris Huang from UBS. And first of all, congratulations on the results. I have 2 questions. The first one maybe on the U.K. I mean, the momentum of the U.K. market seems to be turning as you did 7% in H2 for the region. Could you perhaps help us understand better the regional expectations you baked in for the FY '27 guidance? I'm asking because your comps get quite easy in H1. So would it be fair to assume maybe some further acceleration in the U.K. even into the double-digit range in H1?

Secondly, on the U.S., we saw in H2 another very impressive half year. So I'm just wondering here if you could help us understand the underlying drivers of the growth of this 27% in H2. How much was driven by new stores and how much by the uplift in average selling price and volumes within the existing stores, please?

Thanks, Chris. U.K. market is good, and we characterize it. It's stabilized in fiscal '25, which we reported. We continue to see it as stable. We have picked up a bit of momentum. We have areas in which we are performing very well. Our Bond Street Rolex flagship store is doing extremely well, very proud of the performance and particularly the feedback from clients on that store, which really couldn't be better. So that's a great success. Our e-com business in the U.S. and the U.K. is doing very well, and we had a real standout performance in jewelry. And it's honestly, it's just a lot of the good things that we're doing across our network. We have the year 2, year 3 of major expansions that we've done in prior years, seeing the benefit of them coming through.

We don't split our guidance by market. So we can't tell you what our assumption was for the U.K. other than to say that we're carrying good momentum in. We see the market is stable. We see it as continuing to be so for the year. There's obviously disruption around politically or whatever. But honestly, we see the circumstances that we're in today is better than they've been in the last couple of years with the amount of instability that's been overall. U.S. market is, on the other hand, very strong for reasons that I said, the underdevelopment of the category, the watch category in particular and very kind of positive frame of mind of the high-income consumer combining to create good market conditions.

Again, we carry into the year experiencing -- the new year experiencing those conditions. We're up against tougher comps, of course. And we project forward the business based upon what we're experiencing. But obviously, the comps that we're up against are going to be that bit tougher. So our advice would be not to -- this is our best call for the market as the guidance that we're giving. We wouldn't get carried away beyond that at this point. There's obviously things going on in the world that can still affect the climate that we're doing business in. But the ASP and pricing, we can get back to you on the average price for the year.

I mean most of the pricing action that we saw as a result of the tariffs impacted this last fiscal year FY '26 predominantly. There has been a few price adjustments due to the gold price, and that's the part of the segment in watches that has been somewhat impacted, but it's not been the materiality that we saw in last fiscal year.

Yes. And we never anticipate price increases, you know that and they generally happen at the start of the calendar year, not always, but they generally happen at the start of the calendar year, but we never assume it in our numbers.

Our next question comes from Richard Taylor from Barclays. We move to the next question from Adrien Duverger from Goldman Sachs.

I just wanted to thank you, Caroline, for the work we've done together over the last few years and good luck in your next endeavor. I have a couple of questions, if possible. The first one is, if you could please comment on the momentum ex waitlisted products, both in the U.K. and in the U.S. And my second question would be with regards to the preowned category. So relative to your midterm target, how is Rolex CPO progressing? Are you now selling Rolex CPO in all of your stores, both in the U.K. and in the U.S.? And do you still -- is it still the second biggest brand in the group nowadays?

Thanks for your questions. The situation with regards to the mix of our business on the supply constrained sector of our business has been very steady. Again, with the demand in the U.S., we could be selling everything to waitlist clients for those brands. In case of the U.K., as we've reported, we have an element of a walk-in business and an element of stock that's available. Again, that seems to be steady. It's a very good experience around, obviously, for our salespeople and clients, at least to have some access to products. So a big part of our business is highly predictable because it is based upon supply and it's based upon the list that we have. We continue to add to the list U.K. and U.S.

When new products come along following Watch and Wonders, we get another wave of additions to the listing, and that happened, of course, this year with the new products that were announced in Geneva. So it remains very steady and a core part of our model and mix. Preowned is going very well. It's at least in line with what we would have expected it to be, maybe even a little bit better. In the case of the U.S., we're in all of the doors for Rolex CPO in the U.K. We have a few more doors still to add that we'll do in this fiscal year. It's really just going to matter of when are we reorganizing or relaying out the store, and we obviously coincide the development with that. So we have a few doors to add yet in the U.K. It's a core part of our business. Sorry?

D&D...

Yes. And the other thing I'd emphasize we have Rolex Certified Pre-Owned business is going very well and the other brand preowned business is also going very well. So as a category, it is our #2 brand, if you like, from that standpoint and a great business for us. We are learning more and more as we go, developing more and more relationships and obviously developing a great awareness with our clients who are coming to take the experience some really interesting product that we can now present. It's been a particular success in Bond Street.

Again, where we have -- if you've been there, we have a beautiful presentation of very interesting products to see and understand quite apart from shopping. We have clients coming to us asking to source vintage product and so on. So -- it's really great space for us. Our new acquisition in Texas, Deutsch & Deutsch will be bringing certified preowned to them as well as some other elements of the business that we can add. So it's really a good category, and it's contributed well to our growth over the last couple of years, including fiscal '26.

And to add to that, the team is getting better and better at procurement and stock management. So the health of our inventory has never been as good as it is today.

And the market, as I'm sure you track is very stable as well from a pricing standpoint following that crazy volatility over '22 and '23.

[Operator Instructions] We are now taking our next question from Kate Calvert from Investec.

I just got a question on Roberto Coin. I was wondering if you could update and give a bit more detail on the 4 mono store trials, how they're going and performing and sort of expectations for the year ahead? And also perhaps update on progress with discussions getting more space in some of your wholesale partners?

Thanks, Kate. The whole Roberto Coin business with us, I'm very, very pleased with the integrations, the collaboration that we have with the teams in Italy with Roberto himself and his family and the team under Peter Webster in the U.S. that we are obviously getting to know. The 4 mono brands, there's 3 at the moment with our forthcoming in Tampa, all going well. The website as well as Roberto Coin DTC going very well. What's going extraordinarily well is the expansion of Roberto Coin within the Mayors Group, where we have installed shop-in-shops and clearly the training and really focused on the merchandising and so on. And we're using -- to your last point, we're using these experiences, these projects to clearly then take them out and present to our other wholesale partners.

And we've more than doubled the business in the Mayors stores from what we've done. And it's become a very important brand and even comparing well to and exceeding actually the productivity of some major brands in the stores. So it's great, but I'm off to Vegas. And in a couple of weeks, the biggest event of the year is the Couture JCK event takes place in Wynn where we happen to have our stores. We have a lot of meetings set up with big department store partners and our big independent retailers. We have a program of expansions that we're working on.

Obviously, they all take time to negotiate to get the space to procure the furniture and everything else. So we're on it and delighted with the results that we got last year, delighted with the fact that we continue to do well despite the fact that we had to put prices up, obviously, since it's predominantly gold, the product. And it's going to be an important part of our business and obviously makes a disproportionate contribution from a profit standpoint since we have both the wholesale and retail margin when we do this direct-to-consumer business and the stand-alone wholesale business is nicely profitable as well. You know that the business that we acquired was a 20% EBIT business. So yes, very, very positive about Roberto.

We are now moving to our next question from Richard Taylor from Barclays.

Hopefully, you can hear me this time. I've got a question on the margin guidance. I know you have the Roberto Coin debtor that was talked about in the Q3 statement. So just keen to understand how much of the 40 to 80 bps uplift you're talking to is an underlying improvement versus some of that unwind.

Well, we never really disclosed the absolute number for Roberto Coin. But obviously, the write-off that we had to take as part of the Chapter 11 proceedings, which now is closed, by the way. We don't expect that to annualize next year, obviously. So that has a slight impact. So you can make up your own number, but I think it's out there.

So I know most analysts have put in around GBP 3 million to GBP 4 million for that. So that's a benefit that we'll have next year. The rest of the margin expansion is coming from operational leverage, which is historically how we've driven the profitability in this business over more than a decade actually. So it's coming from that, the margin expansion, and we expect that to contribute to the 60 bps, which is the midpoint.

And we've worked on our brand mix. It is a great thing that we have -- we're a multi-brand, we're a true multi-brand retailer in the main, and we're able to change the mix of our product as we go, and we've had some really great success and we've kind of reorganized the mix of our brands in terms of productivity and the margin impact. We continue to look at our store portfolio as well. So yes, a few things contributing to the improvement that we are guiding to.

We are now taking our next question from Piral Dadhania from RBC.

Congratulations on a great -- I had 2 quick questions, please. The first one relates to the 2027 guidance, the 5% to 10% revenue growth ambition. Could you help us understand how we should think about the price versus volume split? And then the second question relates to potential U.S. tariff refunds. Is there any benefit accruing to watches of Switzerland from that? Or is there any way in which you could leverage your supplier partners to help you with CapEx or OpEx contributions against any potential windfall coming from that side?

I'll take the second one first. The tariffs obviously are paid by the brands importing the product, not paid directly by us in terms of our watch brand partners. To your point, it takes the pressure off that was there from them in terms of pricing and margin. And of course, as we discuss projects with them and plans and so on with them, we're well aware that the tariff situation is much more favorable to what it was at one point in fiscal '26 and what we may have feared going forward. This specific for us is the importation of the Roberto Coin product and of course, we've made our applications and working on that as we speak. But we don't pay the watch tariffs directly.

In terms of pricing, obviously, we've seen less aggressive pricing coming through from the brands this year than what we saw last year, where brands were making up for the cost of the tariffs and the price of gold that was skyrocketing. So in our guidance, there is a component of pricing that is rolling forward. So for instance, a brand like Cartier took the pricing up in September of last year by 10% in the U.S. Obviously, that benefits us in the first half of this fiscal year. We always incorporate pricing that we know of. We do not include any pricing that hasn't been announced by the brands. So to answer your question, it's going to be a mix of price and volume that's going to drive our growth in the next fiscal year.

That's all we have from our conference audience. I'd like to turn the conference back to the management team for any additional or closing remarks. Please go ahead, sir.

Thank you. Do we have some further questions that have come in online?

We have no webcast questions at the moment. Back for closing remarks.

Okay. Listen, thanks again for joining the call, everybody. And a particular thanks to our team for managing our way through what has really been a bit of a volatile year that we really feel is settled down through the year and carries a more stable perspective in fiscal '27 that we're now in. The teams have done an absolutely amazing job, but obviously very well positioned. We are now more than 50% U.S. business. That is the best market to be in right now, long may it continue. But we're confidently get into a year that we think is a lot more predictable than we might have experienced over the last few. And I appreciate your support and interest in our business.

Good morning, everyone. Thank you for joining our Q3 FY '26 trading update. This is Brian Duffy, CEO; joined by Anders, the CFO; and Colaianni, Group Finance and Investor Relations Director. I'll do some introductory remarks, and then we'll, of course, open for Q&A at the end of that.

We're really pleased with our trading performance in Q3 FY '26, which obviously covers the key Christmas Holiday trading period. Sales were strong across the group and pretty much a continuation of the strong trends that we reported in H1. Demand for our key brands remain strong and continues to outstrip supply in both markets.

In the U.S., we delivered sustained broad-based growth across categories, brands and price points. This reflects the strength of our model and the continued buoyancy of the luxury watch market in the U.S. Our growth projects of Pre-Owned e-commerce, Roberto Coin, are all performing particularly well.

We were also delighted to announce the recent acquisition of Deutsch & Deutsch. This acquisition adds to our presence in Texas with a further 4 Rolex-anchored showrooms. We're looking forward to realizing the strategic benefits of this acquisition.

In the U.K., trading has also been consistent with H1. We continue to be delighted with the performance of Rolex Old Bond Street boutique. This flagship showroom has consistently delivered strong client engagement and is attracting a high level of new customers. The group is sharing key insights from the showroom across the wider estate to support the continued elevation of best-in-class luxury retail experience.

We've continued to make targeted investments in the business to support future growth. This has included showroom development projects, of course, our completely new U.S.-based e-com team, marketing investment and investments behind Hodinkee. These investments are supporting improved profitability in the second half and further improved profitability in future years.

The strong trading performance in the quarter, combined with the early benefits from our e-commerce and marketing investments, good visibility for the balance of the year and the contribution of Deutsch & Deutsch acquisition, all gives us confidence to raise our revenue guidance for the year.

We now expect to grow revenue by 9% to 11% constant currency, an increase from the previous 6% to 10% range that we guided to. EBIT margin percentage will improve in the second half of the year. For the full year is now expected to range between minus 70 to minus 90 bps versus prior year. This reflects brand margin adjustments, particularly -- partially offset by price increases, investment costs and some one-off costs.

Specifically, we have projected a provision in the second half of the year relating to Roberto Coin department store debtor balance following a recent Chapter 11 filing in the U.S. and staff incentives reflecting our sales performance. As noted earlier, the platform infrastructure investments into U.S. e-commerce and marketing we have made, and Hodinkee, in the year are now largely complete and will support e-commerce sales and profitability growth in next year and beyond.

We're really pleased with our trading performance in Q3 year-to-date and its forecast for the full FY '26. This is particularly pleasing given the challenges that our team have faced in navigating what has been a very volatile year.

And with this, we'll hand back to the operator and move on with the Q&A.

[Operator Instructions] Our first question is coming from Adrien Duverger of Goldman Sachs.

My first question would be on the product allocation. Could you please comment on the outlook for inventory allocation across the different brands? Is that in line with your expectations?

And secondly, if you could comment on where you see inventory currently sitting both in the U.K. and in the U.S.?

Then I had another question, which would be on the 2 main markets. How would you describe the consumer environment across the U.S. and the U.K.? And could you please also comment on the exit rates for both of these regions?

Thanks, Adrien. We're obviously -- we're in the period in which we get our allocations from key brands. We've had -- those discussions are not complete at this point, but we have a pretty good indication that we've clearly reflected in our 4-month projection for the balance of -- what now is a 3-month projection for the balance of the year. So we have an allocation, it's a normal process. Nothing has really changed, and we now have certainty. We obviously have pricing as well known for what's happened at the start of the calendar year.

Your second question was on inventory?

Yes. Inventory is in good shape, both in the U.K. as well as in the U.S. In the U.S., actually, we would say that we might be a bit light on certain brands, because some of them were holding back on shipments, waiting for the tariffs to normalize. So there's been sort of a little bit of a supply issue in the U.S. in that sense. But overall, we're in a good place when it comes to our stock.

Consumer mood, here in the U.K., I think my own personal view is it's a little bit better than it was when we last reported to you. We had the budget happening in November and people chat about the Christmas season, what would it have been like. As it turned out for us, it was a good season here in the U.K. I think we're really well prepared for it. And we made some kind of nuance change, made a way bit more emphasis on value, recognizing that, that would have been important to the consumer, and I think we made some really good moves there.

So it was a good Christmas season for us overall. And we continue to describe the U.K. as being stable, which is what we've been seeing more or less for the last 18 months. And maybe as we enter this new calendar year, my sense is there may be a bit of an upturn -- a small upturn in, but we'll see. It's early days yet. U.S. consumer is clearly a very buoyant and positive and confident and spending accordingly.

We saw the Bank of America credit card information for January and again, very strong in our category of luxury jewelry and watches. The consumer, they are very respondent to value of financial assets, which remain very strong, obviously. Their tax situation is net-net positive as well when we talk about the more affluent consumer. And there's no question in the U.S. that the K-shaped consumer behavior is definitely there and evident in the market. So the consumer has been positive throughout calendar '25, and that positivity carries into '26 to date.

In terms of the exit rates that we've seen, there's no change in sort of the momentum going through January. So it's been a good January as well.

Yes.

[Operator Instructions] Our next question is coming from Chris Huang, colleague from UBS.

It's Chris Huang from UBS. I have 2 questions, please. The first one on the consumer profile. You've been reporting very strong top line growth and especially in the U.S., that seems to be -- just continue to surprise to the upside. Could you provide perhaps a bit more color on the consumer profile in terms of their age? How much of a split coming from new versus existing consumers? And anything you can share on that front would be great.

Secondly, on the margin guidance and the moving parts. If I look at the midpoint of your new guidance, which is around 10% sales growth, and this was at the high end of the previous guidance. But at the same time, if we look at margin expansion, the midpoint now sits 80% below the previous high end of -- flattish year-over-year. I know in the press release, you commented several factors that is driving this incremental 80 bps headwind, but would you be able to quantify each of them [ impossible ] (sic) [ if possible ]? And also connected to this, if we should expect any further headwind into fiscal '27, please?

Yes. Thanks, Chris. Consumer profile, I think we have reported to the market consistently that we're really encouraged by a younger demographic in the U.S. I think people get affluent, younger is one thing, but I think there's huge interest in the world of luxury watches with the young consumers in the U.S. And as our experience, even at the high end of the price ranges of what we sell is a very active younger consumer, very knowledgeable about the category.

We obviously have now our Hodinkee media business, which again has a younger appeal overall, and we can get further consumer insight there and to those that really love and appreciate the wonderful world of watches. So yes, it's a really encouraging thing that younger consumers really appreciate this category, appreciate mechanical watches, appreciate that the products maintain value, that they last [ whatever ], they're not disposable products. And it's a real positive for the category.

The last thing on that is, I think the influence of digital media as well, clearly has a younger profile appeal to. And our category lends itself very well to digital communications through advertising, through social media, through great videos in which you can talk about heritage and craftsmanship and modern techniques and celebrity ambassadors. I mean everything about this category communicates very well through your laptop or your phone. So definitely a younger consumer trend towards more women buying into the category, which is great, much more self-purchase.

The other thing about the U.S. to mention a big difference there is a bigger concentration of collectors in the U.S. than we have experienced here in the U.K. So about 25% of our business in the U.K. It's near half of our business in the U.S. So really positive things in the U.S. that give us great confidence about the future of that market. It remains an underdeveloped market measured on a per capita basis, and the rate of growth for the market overall and for our business is very strong.

Do you want to comment on...?

Yes. In terms of the margin profile for the second half, it's improving from what we saw in the first half. A couple of headwinds that came our way was obviously the Chapter 11 that Brian alluded to earlier with one of the department stores in the U.S. We've taken a prudent view on that and provided for it in our guidance. In addition to which we've had a great year. The team has done a fabulous piece of work throughout the whole year, and that's led us to taking up our variable compensation slightly -- versus what we expected.

In addition to which we had a product mix with Pre-Owned continuing to [indiscernible] on really well across sort of both markets. And obviously, it comes at a slightly lower product margin, even though it's cash accretive from an EBIT margin perspective, obviously, you don't get the same flow-through.

Yes. And there's some one-off costs there too. There has been an impact from margin. Obviously, the brands have had to respond to pretty unprecedented levels of cost inflation with the price of gold, with the strength of the franc, the weakness of the dollar and you throw tariffs on top of that. So it's a lot to navigate for the brands. I think they've been very responsible and how they've done it overall, but that has included an element of margin adjustment for us retailers. That is offset by pricing over time. But within the fiscal year, it has a negative impact. And this year, we think it washes through next year. And we have other one-off costs like NIC, of course, that we've reported before in the U.K.

And sorry, just to follow up on that Chapter 11 of one of your partners. Are you able to tell us how much of a headwind you currently baked in? So we kind of know the sensitivity to that.

No, we're not going to specifically comment on that, but it's obviously not helpful.

We'll now go to Kate Calvert of Investec.

Just a quick question on your project pipeline because there wasn't any comments in the statement that I remember. Have you got any delays to your project pipelines for the current financial year? Or is all on track? And what are your sort of early thoughts on next year's project pipeline?

Thanks, Kate. No. No delays. We have our usual full program of activities, both here in the U.K. and the U.S. We obviously have our new business now with Deutsch & Deutsche, separate store projects. We have a lot going on with Hodinkee. We've opened now 3 stores with Roberto Coin, which look fabulous. I was in the States last week with the Roberto Coin team and our store in Miami, which is really great. And we have other projects there, too.

We have e-com that we are moving on to a Shopify platform. Currently, we have watch -- Watches of Switzerland on the platform. We'll have Mayors on that platform too within the coming weeks. So yes, hands are full. We got a lot on. And yes, no change, no delays, some really nice projects both here in the U.K. and the U.S. coming up in the year ahead.

Can you give any more details on those projects in the year ahead?

Yes. So in our Q3, you know that we've kind of changed the kind of cadence of our reporting. We have a lot more information on our half year numbers. So we haven't gone through what we have done historically and listed. There's no change to what we presented and listed in the half year at this point. Big projects here in the U.K., the Glasgow boutique is a big deal. That's on schedule for the opening in early summer. The activity at Heathrow we're working on. We haven't landed on an exact date for that, but we're advanced with Rolex on the design of all of that. So that's great.

We're working through and we'll have completed pretty much by the end of this next fiscal year, the whole upgrade that we did to Goldsmiths and Mappin & Webb here in the U.K. So yes, looking back to half 1 is probably your best reference at this point. And obviously, we'll update as we complete Q4 here.

[Operator Instructions] We now go to Melania Grippo of BNP Paribas.

This is Melania Grippo from BNP Paribas. I've got one question on your recent acquisition of 4 store in Texas. I was wondering if you could please give us an idea of what could be the store revenue uplift after the refurbishment and integration in your group?

We can't really, Melania. We don't -- honestly, we don't know at this point. It's a very recent acquisition. Clearly, our focus in these first few weeks is securing and answering all the questions from the team that are there. They are great people. We've had really good interactions and all that's going fine. We really believe that the format that we've done here of the owners staying in their roles and running the business and staying with an equity interest in the business is a really good format for the nature of the acquisition in this category of the family businesses.

So we're working through all that. We would say they've done a great job of refurbishing 2 of the 4 stores. They look fabulous. But there's a lot of things that we can bring to their network, whether it's online, pre-owned and some other brand developments of that nature. So we're working through it. We haven't clearly done budgets with them at this point yet, but we have them scheduled. And yes, we'll hopefully be able to answer that more in the future.

We do not have any further questions coming in at this time. I'll turn the call back over to management for any additional or closing remarks. Thank you.

Thank you, everybody, for joining the call. Huge thanks to our team for navigating through what's been an interesting and I think a volatile year. We are looking forward to more stable conditions as we plan our fiscal year '27, but feel very good about where we've got to in this year. So thank you for joining us.

Good morning, everyone. Thanks for joining us. Our presentation this morning will commence with me, Group CEO, Brian Duffy. I'll be taking you through our first half highlights and talking about our growth initiatives in the first half. I'll then be followed by our CFO, Anders Romberg, who'll give you more detail and color on the numbers. Then me again to give you a bit more background on our growth pillars and where we stand, and then we'll open things up for your questions. So the top line numbers for the first half year that ended in October, our sales 845 million for the half. We were up 10% in constant currency for the group, driven by a very strong performance in the U.S., plus 20% in U.S. dollars. U.K. was decent at plus 5% when we adjust for the closures -- store closures that we had last year. All in all, a good half year in terms of sales.

In terms of profits, EBIT came in 6% ahead of last year at GBP 69 million in constant currency. Our leverage is 0.6x EBITDA leverage to debt. Our free cash flow of GBP 48 million was 71% better than last year. Our expansionary CapEx, GBP 37 million following all of our projects that I'll be talking more about in detail as we go through. We completed our GBP 25 million buyback, GBP 14 million actually going through in the first half of this year. Our ROCE, we were up 80 bps at 17.3% -- so our pillars of growth and what's delivered our first half year numbers. Showroom investment, both new projects and refurbishment of our existing network. We spent GBP 37 million in total. We completed 8 projects in the half year. We've already done 6 projects in the start of the second half, obviously getting ahead of the holiday period.

We apply disciplined hurdles in terms of payback when we look at all of these investments. And as usual, we have a strong pipeline going forward. Certified Preowned has been a really strong business for us. We're strong both in the U.K. and in the U.S. Rolex Certified pre-owned has become a #2 brand in both the U.K. and the U.S. Non-Rolex Certified pre-owned is also going well. And clearly, we're well established in this growing category. E-com, we're delighted with the e-com results that we've had in the half year, up 17% in constant currency. We had good year-on-year growth in the U.K. and then very high levels of growth in the U.S., where we're coming from a smaller base and having invested in resources in the U.S., both a localized team and a conversion to Shopify platform. So very confident about e-commerce and the prospects that we have for growth.

Luxury branded jewelry, clearly, our #1 focus is Roberto Coin. -- in the U.S., where we had a very strong half year at plus 16% in wholesale.

And everything about Roberto, we love there has been a great response to the campaign that we've done with Dakota Johnson. We'll be opening 3 boutiques in November, December and January, and we've launched a new website on Shopify. Here in the U.K., Mappin and Webb luxury jewelry boutique in Manchester, St Ann's area, we got opened successfully. In terms of acquisitions, our focus, clearly, in the last year has been on Roberto Coin and Hodinkee in the U.S., both going well, both really well positioned for growth. And of course, we continue with our discussions and opportunities on further acquisitions in the U.S. market. Client-centric excellence, something that we've always done at the Watches of Switzerland Group. The opening of Rolex Bond Street last March really gave us the opportunity of stepping up our focus on clients.

We did an extensive training with our team there that allowed us to redefine our Xenia program and now we have Xenia 2.0. And it's working very, very well in Bond Street. We have a Net Promoter Score, as you can see, of 94.5%, which is very, very high. And we're now taking this program and applying it through all of our store network. Additionally, we stepped up our events program, both here in the U.K. and in the U.S., really focusing on our top clients and collectors and more about that later in the presentation. Now over to Anders.

Thank you, Brian, and good morning, everyone. I'm Anders Romberg, CFO for the group, and I'll now take you through the financials. Starting with the income statement. This is presented on a pre-IFRS 16 basis and excludes exceptional items. The reconciliation to the statutory numbers are included in the RNS. Our revenue was up 10% versus last year in constant currency or 8% at reported rates, driven by strong U.S. performance. Net product margin for the half was 90 basis points down versus last year, reflecting adverse product mix and a reduction in brand margins due to U.S. tariffs. Our adjusted EBIT for the half was GBP 69 million or plus 6% compared to last year at constant currency or 4% at reported.

This gave an adjusted EBIT margin of 8.1%, down 30 basis points from last year due to the net margin rate decline as just mentioned. This was partially offset by leveraging showroom costs and overheads. The effective tax rate was 27.5% for the half, a reduction to last year, driven by lower levels of nontax deductible items. Our adjusted EPS was 19.6p, an increase of 8%. Statutory profit before tax of GBP 61 million increased by 50% on last year as prior year statutory profit was impacted by noncash impairments with statutory basic EPS improving by 57% or 6.9p per share, benefiting from the share buyback program, which completed this year. Looking at the breakdown of sales in the half, the U.S. was the biggest growth driver. U.S. retail was up 21% in constant currency with robust demand across brands and categories, supported by the expansion of our showroom network.

In the half, sales was driven by good volume growth as well as some pricing on average about 4%. We're pleased with the performance of Roberto Coin wholesale with sales growth of 16% in constant currency. There's been a positive market response to new product and the advertising campaign that we launched at the start of the year. U.K. sales grew by 2%, but was impacted by the showroom closures we made around year-end last year.

Adjusting for showroom closures, UK grew at 5%, a resilient performance in a challenging market underpinned by the stability of the luxury watch segment and the success of our flagship boutiques. Across both markets, our e-com business continued to do really well and grew by 17% in constant currency. The Rolex Certified preowned program is doing well, and it is now the group's second largest brand in terms of revenue. The first half adjusted EBIT came in at GBP 69 million or plus 6% of last year at constant currency. Adjusted EBIT margin was 8.1%, which is 30 basis points down on prior year due to product margin rate decline, partially offset by leverage of fixed cost. The U.S., including Roberto Coin wholesale is the major growth area. And on 48% of group sales, it represents 59% of adjusted EBIT. U.S. retail had product margin contraction due to U.S. tariffs, but this was offset by leveraging the fixed cost base.

In the U.K., product margin was impacted by adverse product mix with limited leverage on cost base. Roberto Coin wholesale had an increase in marketing costs due to the production of our new advertising campaign. Product margin remained stable over the half. As shown, Roberto Coin wholesale is quite accretive for the group's profitability. We've delivered strong free cash flow in the period of GBP 48 million, which was up 71% on prior year. Free cash flow conversion was 53%, and I'm expecting the free cash flow conversion for the year to come in between 65% and 70%. Adjusted EBITDA was GBP 91 million, an improvement of 4% year-on-year. In constant currency, it was up 7%. The working capital outflow of GBP 30 million represents a seasonal build of stock for the holiday season.

We expect the working capital build to unwind in the second half in line with seasonal trends. We continue to invest in the showroom expansion and refurbishment program, which drives long-term sustainable sales growth. In the first half, our expansionary CapEx was GBP 37 million, and our full year expectation is between GBP 65 million and GBP 70 million. The final payment for the Roberto Coin acquisition was also made in the half, and we completed our GBP 25 million share buyback program. Our balance sheet shows continued strength. Inventory increased to GBP 503 million, an increase of 5% versus last year, reflecting the higher average unit cost of stock from gold prices and U.S. tariffs.

Underlying terms continues to improve. It's important to remember that there is no obsolescence risk in inventory and very low cost of storage. The reduction in payables is driven by timing of supplier payments. Our net debt was GBP 112 million at the end of the half, a reduction of GBP 8 million from prior year. This gives a net debt to adjusted EBITDA leverage of 0.6x, excluding leases. Just a reminder of our capital allocation policy, which we set to optimize capital deployment for the benefit of all stakeholders, focusing on long-term growth. We continue to prioritize growth in our business through investment in our showroom expansion.

We expect to spend between GBP 65 million and GBP 70 million in this fiscal year with GBP 37 million spent in the first half. Secondly, strategic acquisitions are a key pillar of our growth strategy. Acquisition must deliver return on investment in line with our disciplined financial criterias within an appropriate time frame. We'll continue to maintain balance sheet flexibility and to be opportunistic for investment in acquisitions and showroom developments. Surplus capital above and beyond the requirements for these investments will be returned to shareholders. We were pleased to complete the GBP 25 million share buyback program in the period. The second half of the year has started well. We're trading in line with our expectations and are well placed as we enter the holiday trading period.

Today, we are reiterating our full year guidance of 6% to 10% revenue growth at constant currency with an adjusted EBIT margin percentage flat to 100 basis points down on last year. As noted previously, capital expenditure is expected to be between GBP 65 million and GBP 70 million. Our guidance reflects that FY '26 is a 53-week year. It includes visibility of supply of key brands and it reflects confirmed showrooms, refurbishments, openings and closures, but it excludes uncommitted capital projects and acquisitions. With that, I'll hand you back to Brian.

Thank you, Anders. Just again, the headlines of our growth drivers for our business, showroom investment, certified pre-owned, e-com, luxury branded jewelry, focus on acquisitions and clearly a focus on our clients. In terms of showroom investment, looking firstly at the second half of last fiscal year that clearly benefits this full year. The centerpiece of our program for the last fiscal year was obviously the opening up the flagship Rolex boutique in Bond Street. It's been a great success. It's exceeding our expectation and the client feedback about it is absolutely fantastic. 4 floors of retailing, one of certified preowned, we have a service area and then 2 floors of regular retailing. The team are fantastic. The client feedback really couldn't be any better.

Looking at some of the other projects that we did in Tampa, Florida, we relocated to an enlarged space and it really is the best space in the malls between LV and Tiffany and a wonderful presentation of Rolex and the other brand partners that we have there. Our Betteridge store in Colorado and the ski resort of Vail, we again took the store next door, allowing us to expand the presence of everyone there, including Rolex, as you can see, beautiful Alpine design. In the bottom there, you can see Lennox in Atlanta -- Atlanta, Georgia. This was previously a multi-brand space for us with a very nice Rolex shop-in-shop. We were so successful with Rolex that we agreed to convert the entire space to Rolex boutique, now 3,000 feet. It's fabulous and really doing great. We love the town of Atlanta. And I'll show you later what we did with the brands that we effectively displaced in the multi-brand. Top right is Jacksonville, Florida. We had come out of Jacksonville because of the location wasn't ideal.

It took us a bit of time to get back in again, but it was worth the wait, as you can see from that store top right that we opened in February. Bottom right is our first venture into Texas. We love Texas as a market and as a state. We had bought a store that didn't have Rolex or Cartier and other top brands, and we now do in this wonderful execution that we have of Watches of Switzerland that opened back in March. Looking then at the first half of fiscal year '26, we opened this beautiful house in Manchester in King Street. It's spectacular. It's a joint venture with our partners from URA [indiscernible] . We refurbished and expanded in Goldsmiths Kingston. The next one along is the oldest Rolex retailer in the world in Newcastle and Blanket Street, which we refurbished and expanded the retail space in July '25, and it's spectacular.

The multi-brand in Mayors in Atlanta, which we displaced with the Rolex boutique, we effectively opened a multi-brand directly opposite, as you can see here in August '25. Also in August, Mappin and Webb Cambridge, we expanded in September '25, Mary Hill in Birmingham, again, we expanded. The new luxury jewelry boutique in St. Ann's opened in September as did a relocation of our Goldsmiths in Peterborough. So second half, we've been very busy with the opening in the last week of October in Southdale, Minneapolis, beautiful store doing well. We relocated our store in Sarasota, Florida in November. Back here in the U.K., Goldsmith, Oxford, we expanded and converted November 25. Mappin and Webb in Birmingham actually opens this week, an expansion and a conversion. Bottom left also opening this week is the new multi-brand space in Terminal 5 in Heathrow, directly adjacent to where Rolex currently is. I've mentioned already the mono-brand stores for Roberto Coin, one opening in November in Hudson Yards, New York, December, in fact, this week in Las Vegas and then Miami will open in January.

Then in my hometown of Glasgow, we are doubling the space of the Rolex boutique, work is underway, and that should open hopefully early summer '26. And then bottom right will be the new Terminal 5 location for Rolex. Work is underway here again in terms of design and planning, and our hope is to get this open also for summer of '26. It clearly is a multiple in terms of size and impact versus where we are today. So that will be spectacular. Certified pre-owned continues to do very, very well for our business. We're now well established in this category. We've managed margin well throughout this time, and we're 2 years into the program. We are in all of our Rolex stores in the U.S.

We are in 26 showrooms in the U.K. And as we continue with our various projects, we will be in all stores in the U.K. So a lot more to come from Rolex certified pre-owned. E-com, we feel very good about the decisions that we've made. We're up 17% as a group overall. We have a new website on -- we're converting all of our websites to Shopify in the U.S. Watches of Switzerland is up and running on Shopify and Roberto Coin up and running in Shopify and the other face here will happen in the months ahead.

Within preowned, we can offer a Rolex Certified pre-owned, as you see here, which clearly is an important destination for our Rolex shoppers. You can also see Cartier here, which is our best-selling brand online, both U.K. and U.S. And then in the middle, you can see Hodinkee Exclusive that we made available online in the U.S. We've also added other brands as we've gone, and there's a lot more to come from our e-com business, both here in the U.K. and particularly in the U.S. Roberto Coin, we love everything about the brand. And you see here some great images of Dakota Johnson, the campaign that we launched in summer and really only kicked in, in the fall and holiday season that we're in now, but great response to the campaign, both from end clients and from our wholesale customers. We've been working with the teams in the U.S. about expanding our space in Roberto Coin in store, both in top department stores and in top independent stores, and that's going very well.

Our designers and architects in the U.S. worked with our teams in Italy to come up with a new showroom and shop-in-shop designs, which look great. We've expanded the presence of Roberto Coin in our Mayors stores, which I'll show you shortly. We have the new website, and we're also working on opportunities of product merchandising. So a lot of growth initiatives for Roberto Coin. This is to show you how Roberto Coin was presented on the left-hand side in the Mayors stores. It was a great success in Mayors. It was very productive and going very well. But having now moved it to the space you can see on the right, it clearly is a huge elevation of the brand. We've actually increased productivity, and we've more than doubled sales.

So this is good clearly for our business overall, but it's also good as examples that we can now take to our wholesale partners and look to introduce shop-in-shops in other stores. Monobrand stores that we are in the process of opening. Top left is Hudson Yards, New York, which has opened, has been opened for 2 weeks, all going well. The right-hand side is the forum shops and Caesars in Las Vegas will open this week. And bottom left is Miami Design Center, which will open in January. This is the website that looks fantastic, very, very user-friendly, very easy to navigate, very easy to find your product or to find out information on the brands, great videos, both of Dakota Johnson and great videos from Roberto himself about his inspiration and background and product clearly and has been a fantastic response to this new website.

The luxury branded jewelry boutique in St. Ann's, we opened in September. We had a great event in October, as you can see from the image on the left, it's a fantastic location, listed building and a great response from our clients. On the left, you can see how the Rolex store looks already for Christmas time and Bond Street looks really spectacular and continues to trade very well and ahead of our expectations. We've been doing wonderful events there, the highlight of which was an event with Roger Federer. He really was a fantastic ambassador of Rolex, really spending time with our clients and a great representative of the brand and our clients were thrilled to be there. You can see the scores that we're getting from our client feedback, 94.5 Net Promoter Score. And of the clients that respond to our questionnaire, 98% say that we either met or exceeded their expectations.

By far, the majority saying we actually exceeded the expectations. Other events that we've done throughout the country with Rolex, and you can see they are pretty spectacular. Our clients love to be there, and it really is all part of our client excellence and client-centric focus that we have. Other events, we launched fairly quietly the Audemars Piguet House in Manchester with our partners at AP leading up to this event that we had in October. The space is so perfect for hospitality and events, as you can see, and really great evening. An example here of us taking over the Aventura store with Roberto Coin, bringing our top jewelry clients along. It was a hugely successful event. And it's our sales teams, our sales colleagues in the U.S. really at their best.

And another event in New York in Soho, where we launched the Porsche exclusive product. We did it with Ben Clymer effectively hosted the evening, and we had none other than Orlando Bloom there, who's a great enthusiast both for watches and for Porsche a really great combination. But it was a fantastic event, and we really had to control the number of people that were coming, huge interest and a really great example of us using our new partners and connections with Hodinkee. So overall, we have strong momentum across the group. It was a standout performance in the U.S. at plus 20%. Our model is clearly working our approach to our clients, our designer stores and our training of our great teams. Our registration of interest lists continue to grow with high conversion overall. So no change on that.

Certified pre-owned clearly well established in line with the ambitious expectations that we had presented to the market before. E-commerce, very strong U.S. investments that we've made are clearly driving a very strong sales performance in the U.S. Great progress with Roberto Coin, a lot more to come. Great progress also with our friends at Hodinkee, and we are in the process of developing some important growth initiatives with them that you'll hear more about in fiscal '27. A great delivery, strong delivery of our catalog of projects with a lot more in the pipeline. We're well positioned for the holiday season. We're off to a good start with the 5 weeks of November now behind us, and we've been happy to reiterate our guidance. So I'll now pass over for your questions.

[Operator Instructions]. Our first question is, great numbers, but in the U.S. sales strength -- is the U.S. sales strength sustainable? Or was this just front-loaded pre-holiday demand?

So, thanks for your question. I'll give a couple of comments and then David could add a bit more flavor being directly responsible for our U.S. business. The U.S. market has been strong more or less since we started our venture there. It's increased as the investments go into the market. The market had been deprived of a lot of retail investment was our observation in deciding to go to the market, and that's been proven to be correct. And since then, we've been investing, others have been investing in the market and the consumer has really responded very, very positively. This last calendar year, in particular, the market has been strong. There's no doubt that the high-income consumer in the U.S. has got a really positive propensity to spend.

We think it's sustainable that the stock market is strong. There's tax cuts around and the overall economy, again, particularly for the high-income owners seems to be very positive. But -- so it's a combination of, I think, the macroeconomic situation is good. The underdevelopment of the watch market that's clearly been the case, which is being addressed overall. And then without doubt, we believe we're gaining share in that market with a lot of initiatives, whether it's e-commerce or preowned or just building big, beautiful stores and giving great client experience. David, what would you add?

Yes. I mean it's -- look, we're delighted with the first half of the year. The U.S. market has been strong. Since we came into the market, we started investing, and I think so do the other retailers and the brands are really focusing in on the U.S. as a prime market. We are coming up -- in the short term, we are coming up against tougher comps in the second half. But longer term, we still believe that the luxury watch market is underpenetrated. You've got huge high net worth and not only in the New York, Miami, Vegases of the world, but also in cities that we've gone into like Cincinnati, Minneapolis. We're 8 years young in the U.S. We're still maturing in our client base. We're still adding significant amounts of new clients to our business.

And there's just a huge interest in horology in general in the U.S. I think a lot of that triggered by Hodinkee in the first part of which we now delighted that we acquired Hodinkee over a year ago, and we felt like we were the counterpart to that when we came into the U.S. market. We're continuing to refurb and expand our stores and continue to have a pipeline of new projects that we're going to be developing. Great early success with our replatforming of our e-com, but we've only done 2 websites to date, Watches of Switzerland and Roberto Coin very, very late in the quarter. And so there's a lot of growth potentially there. And we've also seen great success with the client events that we've done. So yes, a lot done, but a lot more to do to grow the market.

Just a final couple of points just to add to that. Something that we didn't know in advance but discovered with our experience is that the proportion of collectors in the U.S. is actually much higher than it is in the U.K. So those -- to David's point, those that love watches, really love watches buy across the brands and are very, very serious collectors and very, very knowledgeable. The other advantage I think we have in the U.S. is we are geographically very well positioned. Vegas really came back to life big time post COVID. It's a great resort, and we're very, very well positioned in the best resort within Vegas being Wynn. Florida has been outgrowing the rest of the U.S. from an economic standpoint. A lot of people have migrated to Florida. It's the biggest proportion of business that we have in the U.S. And of course, New York is always New York and continues to do well, too. So I think a lot of other aspects just contribute to this positive momentum that there's been there that I think we fully appreciate now, and we're optimizing our position.

Thank you. Our next question is, how do you see the consolidation in the U.S. market? And are there any active M&A opportunities that the company is looking at?

So the consolidation has been quite significant. It's been a big part of the transformation of the market. As I said earlier, the market was underinvested, was predominantly represented and still is predominantly represented by small enterprises, family-owned businesses. And it wasn't [indiscernible] thought the question. I'm sorry...

In terms of the consolidation...

So -- and when we arrived in the market, there was almost double the number of doors that were retailing Rolex than there are now. So there's been a significant consolidation at a time where there's actually been a big increase in business overall. And it's not just Rolex across all the brands that we represent, there's been this consolidation of distribution. In terms of M&A, acquisition has been 37% of our business today was acquired. The rest of it, we've either grown or started new. There remains significant opportunity for M&A. And we are -- as we've always been since we arrived in the U.S., we are in active mode in terms of searching, negotiating and hopefully, at some point, delivering on a further acquisition in the U.S. Would you add?

Yes. No, I think, Brian, everything that you said holds true. There's been an elevation of the U.S. market and a consolidation at the same time, which means that the stores that we have are significantly more productive than the stores that were in place in 2018 or 2017 when we entered the market. We've got a proven track record of acquisitions. These acquisitions are generally family-owned businesses. So it's not just like a straight line in terms of for us to be able to say, well, we're going to be able to do this many acquisitions per year or per quarter, but we're very confident in our ability to be able to continue to acquire in the U.S. over time.

And to add to that, around 70% of the market in the U.S. is still run by independents and 30% of the market is run by groups like us and others. So there is a huge opportunity for further consolidation in the market, which we think is inevitable over time.

Next, we have, you've shown attractive payback periods and ROCE for Roberto Coin boutiques and shop-in-shops versus traditional multi-brand watch showrooms. For your internal capital allocation process, what sort of long-term return range are you targeting on incremental Roberto Coin investments? And how does that compare with the hurdle rates -- with the hurdle rates you use for other boutique or monobrand format investments across the group?

Roberto Coin hurdles and paybacks, we wouldn't anticipate being hugely different. The Roberto Coin business is a very profitable one for us. It's very profit accretive. Obviously, we'll be looking at vertical margins with DTC. So the profitability should be higher. We are rightsizing the stores. But we'll take the same rigorous approach to capital opportunities as we've done in the rest of our network. We've always shown really good paybacks. Average payback on store investment, a 2.5.

2.5 to 3 years.

2.5 to 3 years. New stores can be a little longer, particularly if they're street side rather than mall -- in the U.S. So you might be looking at 3 to 4 years in new stores and acquisitions that we just talked about earlier, we look at -- we've experienced a payback of around 4.2 years, which I think is exceptionally good on acquisition. So we'll apply the same kind of rigor. We've never been deprived. We've never had to choose between investment opportunities, but obviously well financed. Our leverage is 0.6. So we have lots of room in terms of our facilities. So we don't see ourselves as being restricted in having to choose between opportunities that we think are going to offer good payback and growth.

I think on Roberto Coin, we've got many growth pillars in terms of -- and again, we're looking to invest across all of them. So yes, we have the monobrand stores, the first of which we've opened, and we've opened up in the first 3. We're specifically picked to open up in areas where we already have significant strength in those markets. We want to continue to grow with our wholesale partners, both the department stores where we're performing very strongly and all of the wholesale multi-brand partners across the U.S. And that we believe is going to happen as well. We also have robertocoin.com, which we're seeing positive early signs.

But again, we've just replatformed recently. And then our partner.com as well, and we see none of these as being cannibalistic. We still see significant opportunity to grow the brand over the next few years.

Thank you. Our next question is also on Roberto Coin. What is your 3- to 5-year view on Roberto Coin revenue growth? And how many showrooms can the brand have 5 years down the road?

We haven't -- a, we haven't fully determined that yet. We've only owned the business for a year. We've really got to know the business. We've got to know the product. We've got to know the distribution. We are very confident about expanding in retail, but you never get 100% right first time. So we'll refine and improve and come up with a perfect model in retail. And of course, we'll then look to roll out further. There's great growth and space potential within existing wholesale distribution, department stores and high-quality independents, we'll be very active on that. We're just very confident. It's a great market. It's the biggest market in the world for luxury branded jewelry. It's performing very well as a market right now. And there's no question at all for the quality of the product designed and made by Roberto Coin, this business deserves to be bigger, deserves to be in much better distribution, and we have plans to do all of that. And when we fully worked it through as a plan, we'll talk to the market at that time about our goals.

Thank you, Brian. Next, we have, why do you classify CapEx spend on refurbishments and relocations as expansionary rather than maintenance CapEx? And is there always a significant sales uplift on these types of CapEx spend?

Traditionally, when we spend capital on our existing stores, it's not that we stick with the same space. We typically expand it. We tend to take the unit next door and make it into dedicated Rolex space. So if you look at our Rolex space in our franchise, it's grown quite significantly over the last decade in all of our formats and particularly in the U.S. where sort of it was underinvested in the stores that we acquired. So we do not look at it as maintenance CapEx because it's a full refurb of the facade and so forth. So it's a lot of structural work that goes into it as well. So that's why it's expansionary CapEx.

I think it's a perfect example. It was one of the ones that was in the presentation, which was in Atlanta in Lenox, where we moved from, let's say, a B location to an A+ location originally where we took over 3,000 square feet for Mayors multi-brand anchored by Rolex. I think that paid back in less than a year. And now since then, we've taken that space and just expanded it, turned it into a Rolex boutique -- right next to that, we've got a TUDOR mono brand, right next to that, a Breitling mono brand. And as Brian said in the presentation, just recently, we opened up a Mayors multi-brand opposite.

Thank you. Our next question is expansion CapEx for the past 3 to 4 years have been GBP 70 million, which is quite high as compared to the historic level of GBP 25 million to GBP 30 million. As the company is close to refurbishing most of its stores in the U.K. and the U.S., what level of CapEx should we expect going forward? This will have implication for free cash flow and return on invested capital, which are down significantly in the past couple of years.

So our expectation is to finish off our expansionary program within our existing network towards the back end of next fiscal year. So the need for expansionary CapEx in the existing network is as a percentage of sales going to start to come down as we move beyond that. That's our expectation. And the absolute for that segment of our portfolio is going to come down somewhat. So we do expect free cash flow conversion. Last year was impacted by the way of a change of terms. So this year, we're projecting our free cash flow to come back up to the 65%, 70% that we normally tend to generate. So yes.

Thank you, Anders. Next, we have U.K. economy is slowing and additional taxation is forcing high earning high net worth individuals to migrate to other tax-friendly countries. How does the company look at this situation as 50% of the business comes from U.K.

Yes. I mean the U.K. economic situation is not particularly positive. We regard it as stable, and that's the way that we've described our business in the market that we're operating in. Second half of last year, the U.K. business was up 6%. First half of this year, we're up 5%. So I think it has been pretty stable overall. We honestly haven't recorded in any significant way a loss of business because of people migrating to Dubai or Italy or Switzerland or whatever it may be. We would say very much to the government that there's areas in which they really could help that would be in their interest such as bringing back tax-free shopping. We're the only country in Europe that doesn't provide tax-free shopping. That's probably, not probably, that's in recent history, been a much bigger deal to us than losing any of our clients. Honestly, I can't think of a high-end client that I'm aware of that's actually migrated from the country, but we all know the stats that to some degree, that's happened on [indiscernible] and others.

Also, it's worthwhile to point out that the largest portion of our business in the U.K. is actually not centered around London, where you tend to have the high net worth individuals, but it's actually in the regions of the country. So our exposure to that audience you talked about is not as profound as you would find in a lot of other luxury segments.

Thank you. Following on from that, we have, from an understanding point, is it possible for anyone to buy a Rolex watch if they are not a resident of the country where the AD is located? There was a risk that if U.S. remains Swiss tariffs at 39%, then most U.S. nationals would move around the world and buy Rolex is at much lower prices.

Yes, I think that risk did exist over the years has existed when you've had changes in exchange rate and so on. All of the brands try and minimize the arbitrage that exists. So you don't have that happening. And so we don't expect that to change overall. On the specific question of can someone come here and buy a Rolex, honestly, not easily or other brands that we have on waiting list. We would look for the -- we would look to get to know the customer or something about the customer and buying a special product, and they would never get it immediately available and therefore, that typically wouldn't apply to visitors. So it's not a meaningful part of our business at all at this point.

Thank you, Brian. And what's happening with your inventory levels? Have they normalized after the supply constraints of recent years?

Our inventory levels are healthy. So we closed out inventory up 5% year-on-year. And obviously, the cost per unit within our stock has gone up as gold prices has gone up as well as the U.S. tariffs. So per unit cost has actually gone up a bit. And so our underlying turn in stock is actually up and doing better than what we saw last year. So inventory is good actually.

Thank you, Anders. Our next question is, how are the waiting lists looking these days? Still long or have they eased a bit?

Long. Yes, it's very honestly, very little change. And we've always had -- we call them registration of interest list, we've always had them for the majority of our key brand products. Slightly less in the U.K. than it was in the height of '22 with the COVID situation, COVID impacted markets that we are in, but you're still looking at clients having to be very patient to get the watch of the dreams.

And are younger buyers still coming through strongly? Or is demand mainly from existing clients?

Well, one great thing about the U.S., and David could comment on it again, is it's the appeal of beautiful luxury Swiss watches in the U.S. in particular to a younger group of consumers. There's a great interest in horology. There's a great response to a lot of activity that happens in digital. So you definitely have a younger audience. And of course, we've only been in the U.S. 7 years. Our business has gone from 0 to 1 billion during that time. So a great deal of our clients, therefore, are new. It's not the case like we are in the U.K. where we've been here forever. So we have a lot of new clients and David and his team really focused on ensuring that we have a very healthy recruitment of new clients.

Yes. I think the luxury watch category and jewelry as well, I think, has benefited so much from social media, from Instagram influencers. You see time pieces go viral on influencers risks or there was an example of Rihanna wearing a Jacob and Co watches as a necklace. Everybody knows what watch Taylor Swift was wearing when she announced her engagement. So all of that has an effect, and that's helped to boost it. I also think that there's so much stuff that's redundant these days in terms of your phones and every couple of years, you got to replace it because there's almost an in-build redundancy with the battery, et cetera. People are interested in things that last a lifetime. People are interested in craftsmanship, and we're seeing younger and younger demographics coming into our stores. And I think the acquisition of Hodinkee over time will help us as well because when there are new releases of product and when you talk about Watch and Wonders and the major trade fairs, Hodinkee is where everybody goes, first of all, to take a look at these time pieces.

And what is your highest margin segment?

Well, we obviously have our segment reporting in accounts this time. So you can see that Roberto Coin Inc. is by far the most profitable segment in our business with an EBIT margin north of 20% in spite of having invested quite a lot into marketing activity in the first half.

And what's your plan to accelerate growth in the U.K.

To keep doing the great job that we are doing, honestly, we've grown significantly in the U.K. The only period of disruption that was significant in the market was in '23, the kind of post-COVID period during which consumers had different priorities and also coincided with some fairly aggressive price inflation that really discouraged the U.K. consumer. That apart, the market has always been positive. It's the biggest market per capita in the world as the U.K. We have somewhere around a 50% market share. So we're delighted to be here. And we've always performed a little ahead of the market growth. We think the market has normalized. And we have a lot of initiatives for growth around our stores, around the preowned category. Our e-com business is back growing again. We want to grow our jewelry position in the U.K. So we're confident about growth in the market.

Thank you, Brian. And following on from that, what about the U.K. budget? What effect will that have on you as a business and your customers' appetite to spend on big ticket items?

I mean, not positive. And I think the timing of the budget was particularly inconvenient, the fact that it was delayed to the end of November. In fairness, we haven't seen a negative impact following the budget, we're trading pretty well now that we're well into the Christmas season. So we've got November behind us, and we're trading well overall. But -- it's been a series, obviously, of tough news for the U.K. consumer in terms of tax rises and concerns that are out there. So it's not a positive consumer climate overall. But I don't think it's deteriorating. I might even contend that post budget, it was moderately better, at least -- everybody knows what's happened and maybe the worst fears weren't realized. But we get to next year, confident and positive and optimistic.

To add on to that as well, we have a question, which says, are you seeing any slowdown in luxury watch demand given the broader consumer environment?

No, we haven't really seen that. So the reality is that during '22 and '23, there was an aggressive pricing taking place in the U.K. marketplace, which alienated the aspirational consumer, particularly in some of the regional areas. The brands are gradually correcting that and coming in with new product ranges at more attainable price points. So actually, some of these brands that were in pretty radical volume decline when we look at '24, '23. And they've started to come back actually. So we're very optimistic actually about what the brands are doing here.

Thank you, Anders. Our next question is, what's been the biggest surprise in customer behavior this year?

Honestly, I think we regard the market as stable and very much more predictable and therefore, honestly, not that surprising. Inevitably, we have, as Anders says, great activity going on with new products, and we love to see the positive response when these new products come to the market. But I'm trying to think of anything that the demise of Liverpool FC has been a surprise overall. But I think anything within our market or consumer behavior that we would.

I can't really point to anything specific in the U.K. What we have seen is actually research on online. Online has done really well for us this year, and that's a positive thing, I would say. Our Rolex-certified preowned is doing phenomenally well, both in the U.K. as well as in the U.S. And so there seems to be relatively low price resistance, to be honest, because these products are quite pricey, as we all know. And on average, they're about 30% above what a new Rolex would cost. So there is a strong demand in the market still. We can sort of tell that from what's going on.

One thing that was different from what we have predicted is the real growth and success of Rolex certified pre-owned has been predominantly in-store. And we actually thought it would be a bigger proportion of online similar to what it is in the U.S. market. So that was a surprise. I mean it's not a major surprise in the whole mix of everything that we do. But it's a new consumer group and they're shopping predominantly in store.

And what is your thinking on dividend strategy?

Well, we want to have sort of our flexibility as we've expressed in our capital allocation policy. So we'd like to maintain our primary objective is growth, and we still see the U.S. market as a huge opportunity for further consolidation and growth, either through acquisitions or new stores and projects. So clearly, our priority will remain in that space. So locking ourselves into an ongoing dividend program at this point in time, we don't think would be the right way to return to the shareholders. In case we can't find good ways to return to shareholders through growth, then we will opt to do further buyback short term. Long term, yes, we might want to consider a dividend policy.

And are you considering more share buybacks?

Right now, the priority will be to finish off our refurbishment program and our focus is on further acquisitions.

Thank you. Given the U.S. business is north of 50%, is the company thinking of shifting its primary stock market listing to U.S. to lift the valuation?

No. It's still slightly south of 50% at this point. We're getting there quickly. It's north of 50% on profitability, but not yet in sales, but it's inevitable with the great job that David and his team are doing. We've been provoked to look at the U.S. market listing. It's just not something that we would consider doing. We're very happy in the U.K. We have a lot of loyal shareholders that are here that we've got to know that have supported us since we IPO-ed back in 2019. So it's not something that's likely or all on the cards.

Thank you. How should we expect -- sorry, how should we expect the number of showrooms to change over the next few years? Should we expect more closures in the U.K. and expansion in the U.S.

I think yes to that. We're consistently looking at our store performance and markets change and brands change and we always apply a strict criteria of profitability. It's very unlikely that we'd ever have the number of closures again in any one fiscal period as we had at the beginning of this year. That was really coming out of this volatile period that we've been through of COVID and post-COVID. So we always look -- and whenever we do close stores, by the way, we do everything possible to minimize our cost of liability. We redeploy the stock. We inevitably run down to the end of the lease, so there's no lease exposure. The capital will generally be written down, and then we do everything we can to redeploy our experienced trained staff. But there's lots of opportunity for us to grow in the U.S. And proportionately, yes, the U.S. is where we are more likely to add stores and grow.

Thank you. Our next question is, what would be your approach to valuing Watches of Switzerland Group? And in your view, is the company undervalued? Or is the market missing something? Or is the market overpricing certain risks?

I think we've been faced with an interesting journey since our IPO. We've only been public since 2019, as you know, we had less than a year and we had COVID and the post-COVID, so it's been a bit of a roller coaster in the marketplace. But if you look at it over that period, the growth into our domestic clientele over that period has actually been 13.5% in total. But if you just look at the domestic consumption, it's 20%. So we performed really well throughout a long period of time. So I personally don't think that we're getting enough credit for that from a valuation point of view.

The reality is that we've acquired an asset in terms of Roberto Coin, which is very accretive for our profitability business, which we have good growth plans for. I don't think that's reflected either. And I think there is a misconception amongst some investors regarding the impact of the Bucherer acquisition made by Rolex, which was done for various reasons, but it was succession, continuity of the business. That was the reason. That was reemphasized by Jean-Frédéric Dufour in Dubai just last week, I think it was. So yes, we've had a few blows.

The consensus of our advisers is that we are undervalued by any traditional mechanism that's there. But all we can keep doing is delivering on our plans and expectations and hopefully beating the expectations that are out there and just keeping more clients happy with the great products. And I'm sure in time, things will take care of themselves.

Thank you. That brings us to our final question for today. If there's anything we didn't have a chance to address, please feel free to e-mail the team, and I'll be happy to follow up after the session. So how realistic is it to achieve the long-range plan you set in 2023 to double sales to GBP 3 billion by FY 2028.

The long-range plan that we presented was based on a number of growth initiatives that we presented to the market. Every one of those growth initiatives we're either achieving or ahead of, whether it's e-com or luxury jewelry or certified preowned or preowned business in total or even acquisitions. So we're very happy about the strategy that we presented then and the fact that we're delivering. But inevitably, the world changed pretty quickly after we had presented that plan. And therefore, from a timing standpoint, we are unlikely, you would say, to deliver against the exact timing of what we talked about. But the plan is very intact.

We believe in all the growth initiatives. We'll be updating the market at some point in the next calendar year as to how we see the future going forward. But we have a really sound strategy. We've delivered on good growth. And we believe that through this time, we've outperformed the market and very happy about where we're headed.

Personally, I would just say that, yes, I've never been as excited as the number of opportunities that we have at the moment. And we've just got to make sure we cadence them out and execute them. Brian already said that 37% of our growth in the U.S. came from acquisitions and then about over another 30% from what we've done with those acquisitions. We've yet to fully mature everything that we've taken on. And with Roberto Coin and I think, we're just at the very early stages. And I think, again, 1 year on from acquiring both of those businesses, we're far more excited about the opportunity than even we were a year ago. So there's a huge amount for us to go after. We just need to make sure we execute it.

Thank you. As that was our final question, I'll now hand back to the management team for any closing remarks.

Certainly to say thank you for joining us. It was a really great list of questions. People obviously have taken the time to get to know our business and pose very good questions for us to respond to. As David said, we certainly feel very confident about the future, feel very well positioned, feel very well resourced as well, in particular in the U.S., we've really built up our infrastructure and positioned ourselves well for growth. We have some great opportunities like Roberto Coin, like Hodinkee, like further acquisition activity, like what we're doing on pre-owned and e-com, U.K., U.S. So we have a lot to go at and I feel very good about our future, and I appreciate you joining us.

Thank you to the management team for joining us today. That concludes the Watches of Switzerland investor presentation. Please take a moment to complete a short survey following this event. The recording of this presentation will be made available and engage investor. I hope you enjoyed today's webinar.

Good morning, everyone. Thanks for joining us. Our presentation this morning will commence with me, Group CEO, Brian Duffy. I'll be taking you through our first half highlights, talking about our growth initiatives in the first half. I'll then be followed by our CFO, Anders Romberg, who will give you more detail and color on the numbers. Then me again to give you a bit more background on our growth pillars and where we stand, and then we'll open things up for your questions.

So the top line numbers for the first half year that ended in October, our sales is GBP 845 million. For the half, we were up 10% in constant currency for the group, driven by a very strong performance in the U.S., plus 20% in U.S. dollars. U.K. was decent at plus 5% when we adjust for the store closures that we had last year. All in all, a good half year in terms of sales.

In terms of profits, EBIT came in 6% ahead of last year at GBP 69 million in constant currency. Our leverage is 0.6x, EBITDA leverage to debt. Our free cash flow of GBP 48 million was 71% better than last year. Our expansionary CapEx, GBP 37 million following all of our projects. I'll be talking more about in detail as we go through. We completed our GBP 25 million buyback, GBP 14 million were actually going through in the first half of this year. At ROCE, we were up 80 bps at 17.3%.

So our pillars of growth much delivered first half year numbers. Showroom investment, both new projects and refurbishment of our existing network. We spent GBP 37 million in total. We completed 8 projects in the half year. We've already done 6 projects in the start of the second half, obviously getting ahead of the holiday period. We applied disciplined hurdles in terms of payback when you look at all of these investments. And as usual, we have a strong pipeline going forward.

Certified Pre-Owned has been a really strong business for us, strong both in the U.K. and in the U.S. Rolex Certified Pre-Owned has become our #2 brand in both the U.K. and the U.S. Non-Rolex Certified Pre-Owned is also going well, and clearly well established in this growing category.

Ecom, we're delighted with our ecom results that we've had in the half year, up 17% in constant currency. We had good year-on-year growth in the U.K. and then very high levels of growth in the U.S. where we're coming from a smaller base, and having invested in resources in the U.S., both a localized team and a conversion to Shopify platform. So I'm very confident about ecommerce and the prospects that we have for growth.

Luxury branded jewelry, clearly, our #1 focus is Roberto Coin in the U.S. where we had a very strong half year at plus 16% in wholesale. And everything about Roberto, we love, there's been a great response to the campaign that we've done with Dakota Johnson. We'll be opening 3 boutiques in November, December and January, and we've launched a new website on Shopify.

Here in the U.K., Mappin & Webb Luxury Jewelry Boutique in Manchester, St. Ann's area, we got opened successfully. In terms of acquisitions, our focus clearly last year has been on Roberto Coin and Hodinkee in the U.S., both going well, both really well positioned for growth. And of course, we continue with our discussions and opportunities on further acquisitions in the U.S. market.

Client-centric excellence, something that we've always done at Watches of Switzerland Group. The opening of Rolex Bond Street last March really gave us the opportunity of stepping up our focus on clients. We did an extensive training with our team there that allowed us to redefine our Xenia program and Xenia 2.0. And it's working very, very well in Bond Street. We have a Net Promoter Score, as you can see, of 94.5%, which is very, very high. And we're now taking this program and applying it through all of our store network.

Additionally, we stepped up our events program, both here in the U.K. and in the U.S. really focusing on our top clients and collectors, and more about that later in the presentation.

Now over to Anders.

Thank you, Brian, and good morning, everyone. I'm Anders Romberg, CFO for the group, and I'll now take you through the financials. Starting with the income statement. This is presented on a pre-IFRS 16 basis and excludes exceptional items. The reconciliation to the statutory numbers are included in the RNS.

Our revenue was up 10% versus last year in constant currency or 8% at reported rates, driven by strong U.S. performance. Net product margin for the half was 90 basis points down versus last year, reflecting adverse product mix and a reduction in brand margins due to U.S. tariffs. Our adjusted EBIT for the half was GBP 69 million or plus 6% compared to last year at constant currency or 4% as reported. This gave an adjusted EBIT margin of 8.1%, down 30 basis points from last year due to the net margin rate decline as just mentioned. This was partially offset by leveraging showroom costs and overheads.

The effective tax rate was 27.5% for the half, a reduction to last year driven by lower levels of non-tax-deductible items. Our adjusted EPS was 19.6p, an increase of 8%. Statutory profit before tax of GBP 61 million increased by 50% on last year, as prior year statutory profit was impacted by noncash in parallel. With statutory basic EPS improving by 57% or 6.9p per share, benefiting from the share buyback program, which completed this year.

Looking at the breakdown of sales in the half, the U.S. was the biggest growth driver. U.S. retail was up 21% in constant currency with robust demand across brands and categories, supported by the expansion of our showroom network. In the half, sales was driven by good volume growth as well as some pricing on average about 4%.

We're pleased with the performance of Roberto Coin wholesale with sales growth of 16% in constant currency. There's been a positive market response to new product and the advertising campaign that we launched at the start of the year.

U.K. sales grew by 2%, but was impacted by the showroom closures we made around year-end last year. Adjusting for showroom closures, new figure with 5%, a resilient performance in a challenging market, underpinned by the stability of the luxury watch segment and the success of our flagship boutiques. Across both markets, our ecom business continued to do really well and grew by 17% in constant currency. The Rolex Certified Pre-Owned program is doing well and is now the group's second largest brand in terms of revenue. The first half adjusted EBIT came in at GBP 69 million or plus 6% on last year at constant currency. Adjusted EBIT margin was 8.1%, which is 30 basis points down on prior year due to product margin rate decline, partially offset by leverage of fixed costs. The U.S., including Roberto Coin wholesale is the major growth area. And on 48% of group sales, it represents 59% of adjusted EBIT.

U.S. retail had product margin contraction due to U.S. tariffs, but this was offset by leveraging the fixed cost base. In the U.K., product margin was impacted by adverse product mix with limited leverage on cost base. Roberto Coin wholesale had an increase in marketing costs due to the production of our new advertising campaign. Product margin remained stable over the half. As shown, Roberto Coin wholesale is quite accretive for the group's profitability.

We've delivered strong free cash flow in the period of GBP 48 million, which was up 71% from prior year. Free cash flow conversion was 53%, and I'm expecting the free cash flow conversion for the year to come in between 65% and 70%. Adjusted EBITDA was GBP 91 million, an improvement of 4% year-on-year. In constant currency, it was up 7%. The working capital outflow was GBP 30 million represents the seasonal build of stock for the holiday season. We expect the working capital build to unwind in the second half in line with seasonal trends.

We continue to invest in the showroom expansion and refurbishment program, which drives long-term sustainable sales growth. In the first half, our expansion or CapEx was GBP 37 million, and our full year expectation is between GBP 65 million and GBP 70 million. The final payment for the Roberto Coin Inc. acquisition was also made in the half, and we completed our GBP 25 million share buyback program.

Our balance sheet shows continued strength. Inventory increased to GBP 503 million, an increase of 5% versus last year, reflecting the higher average unit cost of stock from gold prices in U.S. tariffs. Underlying terms continues to improve. It's important to remember that there is no obsolescence risk in the inventory and very low cost of storage.

The reduction in payables is driven by timing of supplier payments. Our net debt was GBP 112 million at the end of the half, a reduction of GBP 8 million from prior year. This gives a net debt to adjusted EBITDA leverage of 0.6x excluding leases. Just a reminder of our capital allocation policy, which was set to optimize capital deployment for the benefit of all stakeholders focusing on long-term growth.

We continue to prioritize growth in our business through investment in our showroom expansion. We expect to spend between GBP 65 million and GBP 70 million in this fiscal year, with GBP 37 million spent in the first half.

Second is, strategic acquisitions are a key pillar of our growth strategy. Acquisitions must deliver return on investment in line with our disciplined financial criteria within an appropriate time frame. We'll continue to maintain balance sheet flexibility and to be opportunistic for investment in acquisitions and showroom developments. Surplus capital above and beyond the requirements for these investments will be returned to shareholders. We were pleased to complete the GBP 25 million share buyback program in the period.

The second half of the year has started well. We're trading in line with our expectations and are well-placed as we enter the holiday trading period. Today, we are reiterating our full year guidance of 6% to 10% revenue growth at constant currency with an adjusted EBIT margin percentage flat to 100 basis points down on last year. As noted previously, capital expenditure is expected to be between GBP 65 million and GBP 70 million.

Our guidance reflects that FY '26 is a 53-week year. It includes visibility of supply of key brands, and it reflects confirmed showrooms, refurbishments, openings and closures, but it excludes uncommitted capital projects and acquisitions.

With that, I'll hand you back to Brian.

Thank you, Anders. Just again, a headlines of our growth drivers for our business, showroom investment, Certified Pre-Owned, ecom, luxury branded jewelry, focus on acquisitions and clearly, our focus on our clients.

In terms of showroom investment, looking firstly at the second half of last fiscal year that clearly benefits this full year. The center piece of our program from the last fiscal year was obviously the opening up the flagship Rolex Boutique in Bond Street. It's been a great success. It's exceeding our expectation, and the client feedback about it is absolutely fantastic, 4 floors of retailing, 1 of Certified Pre-Owned, then we have a service area and then 2 floors of regular retailing. The team are fantastic. The client feedback really couldn't be any better.

Looking at some of the other projects that we did in Tampa, Florida. We relocated to an enlarged space, and that really is the best space in the malls between LV and Tiffany and a wonderful presentation of Rolex and the other brand partners that we have there. Our Betteridge store in Colorado and the ski resort of Vail, we again took the store next door, allowing us to expand the presence of everyone there, including Rolex, as you can see, beautiful alpine design. At the bottom there, you can see Lenox in Atlanta, Atlanta, Georgia. This was previously a multi-brand space for us with a very nice Rolex shop-in-shop. We were so successful with Rolex that we agreed to convert the entire space to Rolex boutiques, now 3,000 feet. It's fabulous and really doing good. We love the town of Atlanta. And I'll show you later what we did with the brands that we effectively displaced in the multi-brand.

Top right is Jacksonville, Florida. We had come out of Jacksonville because of the location wasn't ideal. It took us a bit of time to get back in again, but it was worth the wait, as you can see from that store top right that we opened in February. Bottom right is our first venture into Texas. We love Texas as a market and as a state. We had bought a store that didn't have Rolex or Cartier and other top brands, and we now do in this wonderful execution that we have of Watches of Switzerland that opened back in March.

Looking then at the first half of fiscal year '26, we opened this beautiful house, the Manchester in King Street. It's spectacular. It's a joint venture with our partners from Audemars Piguet. We refurbished and expanded in Goldsmiths Kingston. The next one along is the oldest Rolex retailer in the world in Newcastle in Blackett Street, which we refurbished and expanded the retail space in July '25. That's spectacular. The multi-brand in Mayors in Atlanta, which we displaced with the Rolex Boutique, we effectively opened a multi-brand directly opposite as you can see here in August '25. Also in August, Mappin & Webb Cambridge, we expanded in September '25. Merry Hill in Birmingham, again, we expanded the new luxury jewelry boutique in St. Ann's opened in September as did relocation of our Goldsmiths in Peterborough.

So the second half, we've been very busy with the opening in the last week of October in Southdale, Minneapolis. A beautiful store, doing well. We've relocated our store in Sarasota, Florida in November. Back here in the U.K., Goldsmiths Oxford, we expanded and converted in November '25. Mappin & Webb Birmingham actually opens this week, an expansion and a conversion. Bottom left, also opening this week as the new multi-brand space in Terminal 5 in Heathrow, directly adjacent to where Rolex currently is. I'd mentioned already the mono-brand stores for Roberto Coin, one opening in November in Hudson Yards, New York in December, in fact, this week, in Las Vegas, and then Miami will open in January.

And then in my hometown of Glasgow, we are doubling the space of the Rolex boutique. Work is underway and that should open hopefully, early summer '26. And then bottom right, will be the new Terminal 5 location for Rolex. Work is underway here again in terms of design and planning, and our hope is to get this open also for summer of '26. It clearly is a multiple in terms of size and impact versus where we are today, so that will be spectacular.

Certified Pre-Owned continues to do very, very well for our business. We're now well established in this category. We've managed margin well throughout this time and our 2 years into the program. We run all of our Rolex stores in the U.S. We run 26 showrooms in the U.K. And as we continue with our various projects, we will be in all stores in the U.K. So a lot more to come from Rolex Certified Pre-Owned.

Ecom, we feel very good about the decisions that we've made. We're up 17% as a group overall. We have a new website and we're converting all of our websites to Shopify in the U.S. Watches of Switzerland is up and running on Shopify. And Roberto Coin up and running on Shopify and the other phase here will happen in the months ahead.

Within Pre-Owned, we can offer Rolex Certified Pre-Owned, as you see here, which clearly is an important destination for the Rolex shoppers. You can also see Cartier here, which is our best-selling brand online, both U.K. and U.S. And then in the middle, you can see Hodinkee exclusive that remain available online in the U.S. We've also added other brands as we've gone, and there's a lot more to come from ecom business, both here in the U.K. and particularly in the U.S.

Roberto Coin, we love everything about the brand. And you see here some great images of Dakota Johnson, the campaign that we launched in summer and really only kicked in, in the fall and holiday season that we're in now, but great response to the campaign both from end clients and from our wholesale customers. We've been working with the teams in the U.S. about expanding our space in Roberto Coin in-store, both in top department stores and in top independent stores, and that's going very well. Our designers and architects in the U.S. worked with our teams in Italy to come up with a new showroom and shop-in-shop designs, which look great. We've expanded the presence of Roberto Coin in our Mayors stores, which I'll show you shortly. We have the new website and we're also working on opportunities of product merchandising.

So a lot of growth initiatives for Roberto Coin. This is to show you how Roberto Coin was presented on the left-hand side in the Mayors stores. It was a great success in Mayors, it was very productive and going very well. But having now moved it to the space, you can see you on the right, that clearly is a huge elevation of the brand. We've actually increased productivity and we've more than doubled sales. So this is good clearly for our business overall, but it's also good as examples that we can now take to our wholesale partners and look to introduce shop-in-shops in other stores.

Mono-brand stores that we are in the process of opening. Top left is Hudson Yards, New York, which has opened, has been open for 2 weeks. All going well. The right-hand side is the Forum Shops and Caesars in Las Vegas. We'll open this week. At bottom left is Miami Design Center, which will open in January.

This is the website that looks fantastic, very, very user friendly, very easy to navigate, very easy to find your product or to find out information on the brands, great videos both of Dakota Johnson and great videos from Roberto himself about his inspiration and background and product clearly. And there's been a fantastic response to this new website.

The luxury branded jewelry boutique in St. Ann's, we opened in September. We had a great event in October, as you can see from the image on the left. It's a fantastic location, listed building and a great response from our clients. On the left, you can see how the Rolex store looks already for Christmas time, and Bond Street looks really spectacular and continues to trade very well and ahead of our expectations. We've been doing wonderful events there, the highlight of which was an event with Roger Federer. He really was a fantastic ambassador of Rolex, really spending time with our clients and a great representative of the brand and our clients were thrilled to be there. You can see the scores that we're getting from our client feedback, 94.5% Net Promoter Score. And of the clients that respond to your questionnaire, 98% say that we either met or exceeded their expectations. By far, the majority are saying we actually exceeded the expectations.

Other events that we've done throughout the country with Rolex, and you can see they're pretty spectacular. Our clients love to be there and it really is all part of our client excellence and client-centric focus that we have. Other events, we launched fairly quietly at the AP House in Manchester with our partners at AP leading up to this event that we had in October. This space is so perfect for hospitality and events, as you can see, and really great evening. An example here of us taking over the Aventura store with Roberto Coin, bringing our top jewelry clients along. It was a hugely successful event and it's our sales teams or sales colleagues in the U.S really at their best. And another event in New York in Soho, where we launched the Porsche exclusive product. We did it with Ben Clymer effectively hosted the evening, and we had none other than Orlando Bloom there who's a great enthusiast both for watches and for Porsche, a really great combination. But it was a fantastic event, and we really had to control the number of people that were coming, huge interest and a really great example of us using new partners and connections with Hodinkee.

So overall, we have strong momentum across the group. It was a standout performance in the U.S. at plus 20%. Our model is clearly working and approach to our clients, our design of stores and our training of our great teams. Our registration of interest list continue to grow with a high conversion overall. So no change on that. Certified Pre-Owned, clearly well established in line with the ambitious expectations that we had presented to the market before. Ecommerce, very strong U.S. investments that we made are clearly driving a very strong sales performance in the U.S. Great progress with Roberto Coin, a lot more to come. Great progress also with our friends at Hodinkee and we are in the process of developing some important growth initiatives with them that you'll hear more about in our fiscal '27. Great delivery, strong delivery of our catalog of projects with a lot more in the pipeline. We're well positioned for the holiday season. We're off to a good start with the 5 weeks of November and now behind us, and we'd be happy to reiterate our guidance.

So let me pass it over for your questions.

[Operator Instructions] Our first question this morning is from Chris Huang of UBS.

It's Chris from UBS. And I have 2 questions. The first one on your FY '26 sales guidance. I mean you commented that you started the second half in line with expectations, and you generally feel good about the holiday trading period ahead. So if we take the midpoint of the sales guidance at 8%, if my math is correct, that would imply H2 to be around 6%. But when I think about the moving blocks within the group, in theory, you should no longer see any meaningful impact from store closures in the U.K. The momentum in the U.S. seems to be still solid double digit. And at Roberto Coin, I would expect the full benefit of the price increase you did in October to help the numbers in H2.

So with all of this in mind, and of course, we just started H2. But I'm just wondering if you think there could potentially be some upside for the year? That's my first question.

And then secondly, generally on operating leverage. If we really look at your H1 P&L, you actually showed quite impressive OpEx leverage under control, driven by the U.S. retail channel. So I'm curious to know the level of growth you would need generally to start to see fixed cost leverage. I assume it's going to be quite different in the U.K. compared to the U.S. given the product mix. So if you could provide some regional color, please, just to help us a bit more on modeling.

Yes. Thank you, Chris, for your questions. I'll take the first one, and Anders will answer the more complicated one on the P&L and leverage. We feel really positive about the second half that after some uncertainties around the U.K. consumer still by no means upbeat and the budget didn't help. So we'll see how that might affect behavior in the Christmas period. Similarly, in the U.S., as we've reported to the market before the consumer seem to ride over the price increases that happened over late summer. But we are moving into the more gifting season. There might be a bit more price sensitivity there. We don't have allocations yet there on a calendar year basis. So we have 4 months of the fiscal year in which we, as yet, don't know what the allocations will obviously be from our key partners.

So there's still a bit of uncertainty around there. We are delighted that the tariff situation has improved from the 39% down to the 15%, but that's still a reasonable increase on landed cost of product that's coming in. And again, what might be the response from the brands. And at this point, we don't know that either.

So that level of uncertainty is around. Having said that, we have started the season well and we're going to it with good momentum. But putting it all together, we feel that the prudent thing to do is confirm our guidance at this point. And obviously, we'll look forward to updating the market post Christmas.

In terms of the operating leverage question, we haven't ever been that explicit. But if you look at the leverage that we get historically on our cost base, it's been the factor that's been driving our profitability over the last decade actually, and we'll continue to do so.

Product mix is a factor. Obviously, the product margin is the highest cost we have in the business. So the component of Pre-Owned coming into has been somewhat diluted as a percentage. Cash-wise, it's absolutely fine. So in terms of our cost base, it's driven by inflation, obviously, and space expansion and also the 2 major factors, which were partially offset by becoming more efficient in our operations. So I'm not going to say what sales growth we need in order to get the leverage.

Next question is coming from Richard Taylor from Barclays.

Yes. I see there were some comments recently from the Rolex CEO at the Dubai Watch event regarding the relationship with retailers and how they -- basically, they have no desire to change that. Just keen to understand now that a bit of time has passed since they bought Bucherer, how you would observe Rolex's behaving with regards to their retail partners? I know there's a bit of change in the German market recently, for example, but any insights you may have more generally and obviously, the U.K. and U.S. markets in which you operate will be helpful.

Okay. Thanks, Richard. We obviously bet as everybody did, the comments that were publicized that Jean-Frédéric Dufour made at Dubai Watch week. No surprise to us because it's effectively what we said when the acquisition was announced and we did an RNS at the time that was approved by Rolex and the news then was that this wasn't strategic, it was the acquisition was made for other reasons. And nothing would change with regards to how Rolex were managing partner relationships and product allocation and projects. And our experience since then has been exactly that. There's been no change.

We obviously work hard at developing our partnership and relationship looking at a number of projects that is always very objective. The discussions that we have and everything has carried on exactly as it was, and it's what we've been consistently seeing and it's what we've consistently experienced from that relationship. So obviously a long, long relationship for our group, get back literally over 100 years. And it's a big part of our business. It's our most important partnership, and I'm delighted that we continue to make the progress that we do and, I'd say, honestly, our relationship has probably never been so good.

David might want to comment on the U.S. where he manages the relationship directly.

I mean, again, the conversations that we had about this were when the acquisition happened, we've never had it since we've seen -- they've been consistent always in the way that they deal with us. And we've had an incredibly strong pipeline of refurbishments expansions over the last year and some new stores as well like Southdale in Minneapolis that we just recently opened, that's performing very well. Locations like Legacy West in Plano, Texas, where we didn't have Rolex originally. And we continue to have a strong pipeline of projects going forward. So no changes whatsoever.

[Operator Instructions] Now I'll go to Jon Cox of Kepler.

Congrats on the figures. The print looks pretty good. A couple of questions for you. Just starting off with the U.K., and it's been pretty soft for a couple of years. I'm just wondering what your thoughts are going forward. And if you maybe believe that some of the tourists that used to come into the U.K. buying watches have gone for goods with the so-called tourism tax? Or would you be confident that eventually the U.K. should bounce back if you just look at historical trends when for a few years, the U.K. was amongst the strongest growing markets, maybe some sort of post that boom period hangover, and we should start to see a recovery at some point. That's the first question.

Second question, just on the T5 Heathrow, just wondering on the sort of size of that. And well, from my own experience, going through airports, ever trying to go into a Rolex store, the room was empty anyway. And even if -- it's very difficult, obviously, we're trying to leave a name at a Rolex store at an airport. Just how we should think about it? Should we think about it as a decent sized store opening in the U.S.? Or is it anywhere near to Bond Street? Or just to give us a bit of a feel what may be happening there?

And then the last one, just on -- you keep saying Rolex CPO is now the second biggest brand. I'm just always scratching my head trying to work out how much Rolex and Rolex CPO is a combo of your business. And then in addition, you have Roberto Coin where clearly jewelry is a very strong business at the moment. Just trying to get a figure or some sort of indication, Roberto Coin, Rolex, Rolex CPO, is that close to 70% of your business now?

Thanks for your question, Jon. A lot there. The U.K. market I'd describe as having come through a real volatile period. You described it as soft. But if you look back at the kind of tail end of the second half of '23, I think we described it as a bit worse than soft, very, very high price increases. The value was what it was. But from a volume standpoint, the market really was impacted in a way that we had never witnessed before.

We've come beyond that. I think the brand is very typically -- they're ultimately very pragmatic and how they look at our market, pricing has been modest, new product introductions have been good. And we see the market as very recognizable, very much normalized. We were plus 6 in the second half of last year, plus 5 in the first half of this, which we regard as clearly very, very stable and consistent.

With regards to tourism, obviously, we're way down in tourism, but if you compare us to fiscal '19 or fiscal '20 when the VAT-free was effectively removed. So it's in our base. It's on our comparison numbers. We are 95% domestic in terms of our sales. So that's the category, and I think we've done amazingly well to have obviously refocused our business on domestic successfully. And our view has been consistently and remains VAT-free will come back at some point. I think the arguments on behalf of it coming back are really compelling on behalf of the U.K. economy and the treasury. And if the government keeps saying as they do that they want to support growth, then there's a gold nugget, excuse the pun, lying on a beach somewhere that they could pick up and really have an impact. So we continue to support lobbying and trying desperately to get the government to take a more serious look at it, which I do believe they will do it at some time, but hard to predict when.

The new space in T5, can't confirm exactly the space. We're still working with Rolex and Heathrow. It's a very, very prominent location. It's a multiple of size versus where we are today. It's double height. It's really going to be very, very impactful. We make some product available to your point of walking into empty stores. I want to make sure that, that's not the case for this beautiful store we have. It's not quite the case today either with Rolex in T5 and T2. So we're working through all that detail, but it's going to be a really nice store. I think really part of what is a major refurbishment and upgrade that's happening with the luxury retail in T5.

CPO is our second biggest brand. We had ambitious goals that we've told the market about for developing the CPO business, and we are achieving those goals, and we're only 2 years into the program. So let's see how big it becomes, but we're learning, we're developing, we're expanding presence. We're putting in more branded areas. I think very importantly, our salespeople are getting very good and very experienced at selling pre-owned. So we feel very good about it. It's a huge market in the U.S., obviously, and it's a big and growing market in the U.K., and we have a very strong position in both markets.

Roberto Coin is our big focus in terms of getting into the branded jewelry category in a strong way. It's a huge market in the U.S. and Roberto is a great brand with absolutely great product. And we've got some ambitious plans as to how we're going to develop Roberto in that market. And yes, we'd expect it to become a bigger proportion. But we're not giving any numbers, and we're not obviously talking beyond the current year where we've reiterated guidance. But we will be updating the market in all these growth initiatives in due time. But so far so good in them all.

I want to just follow up on the Rolex CPO. I seem to remember that long-range plan from a year or so back. I think is 20% of Rolex will be CPO in the U.S. and 10% in the U.K. by FY '28? You say that you're ahead of plan. You must be pretty close to those figures.

What we said and where we are is that we are in line with the ambitions of that plan, and it was an ambitious plan and delighted that we're tracking very well with the expectations that we had of it. We will update the market in due time about all of our growth initiatives, as I say, so far so good in them all.

The other thing I would say about the U.S. numbers for the first half as well is that it wasn't just Rolex or Rolex CPO that supported the growth. You have the other part of our vintage business, but you've also got brands like Cartier, that's been our fastest-growing brand now for the last 2 to 3 years, has a really healthy mix in terms of the sales across all brands and across all price points in the U.S.

You mentioned updating the market. Can I just push you a little bit on when that may be?

We don't have an exact date yet. We have a lot going on. We are working hard with our new colleagues at Hodinkee and Roberto Coin, for example, and a lot of other projects. But as soon as we have a date, we'll obviously update the market, but we don't have an exact date yet.

Next question will be coming from Adrien Duverger of Goldman Sachs.

Sorry, can you hear me? Thank you so much for the color you provided so far. I have 2 questions, if possible. The first one would be on your -- on the space contributions. So we're seeing an exciting pipeline of projects with both openings and relocations. I wonder if you could help us understand the expected contribution from that space growth for this year and over the midterm in the U.K. and in the U.S.

And my second question would be on the margin outlook. So you reiterated the target for adjusted EBITDA margin to be flat to minus 100 bps. Could you help us with the different building blocks implied in there? Because I know that there must be some impact from some of the manufacturers taking some margin points from retail partners. There must be some impact from relatively recent acquisitions with Roberto Coin and Hodinkee. And also if you could help us understand what we should expect in terms of seasonality for this year?

In terms of our space contribution, it comes down to very much allocation of products from some of our key brands, actually. So we never give space. It's less relevant in our category than you will find in most other retail formats.

In terms of our margin guidance for the year, obviously, we haven't seen how some of the brands are going to respond to the tariffs. We've seen some actions taken, and we've sort of modeled out various scenarios of pricing versus margin contraction versus some pricing and no margin contraction. And I think we modeled through every possible scenario we could think of. And at this point in time, we feel that the margin guidance that we've given still holds water. We're up against some tougher comps in the second half in the U.S. We did have a few big boxes opening up. So we had Lenox in Atlanta. We had obviously Plano in Texas, and we have Jacksonville come on stream. So the comps in the second half in the U.S. market is going to be a little bit more tough.

We are going to continue to spend a bit more on marketing throughout the year, which we think is driving new clients into the franchise. So it underwrites our strategic growth plans. So all good.

Ecommerce in the U.S. has been off to a really, really good start and is growing exponentially. However, we're buying traffic in that sector in order to sort of reach the scale where we started to get the drop-through in terms of margin. So it's somewhat dilutive as you go through that buildup phase. And once we hook in the Hodinkee traffic, we expect that channel to become accretive.

Next question will be coming from Piral Dadhania of RBC.

I have 3 fairly short ones. The first is on the U.K. consumer in the context of your current trading commentary. Could you maybe just give us an indication how the U.K. consumer has responded post the budget from a week or two ago? Have you seen any inflection or change in consumer behavior, change in traffic trends, change in conversion rates post that -- the announcement of the U.K. budget?

The second is on capital allocation. Maybe just a word on pipeline for M&A. You spent -- your acquisition spend in the last 3 to 4 years has been fairly sizable. It does feel like you're maybe deemphasizing the contribution from future M&A. I just wanted to understand where the priorities may be in that context and whether we should expect a step down in acquisition spend in the next year or two? And if not -- and if that is the case, excuse me, then should we maybe also expect a new share buyback plan to be put in place as you think about the most efficient uses of your cash flow?

And then the third and final question is just on feedback in relation to the multi-brand Mappin & Webb jewelry store concept, the multi-brand one. I think it's been a good few months now. Could you maybe just give us a couple of words on how that's progressing and what learnings you can take away from that?

Okay. Thanks for your questions. U.K. consumer, November has been fine. And like everybody, we're concerned about the budget and the delay of the budget certainly didn't help the mood of the country by any means. But post budget, it has not got any worse, I would say. And as we've reported, we've started the season well. We have November behind us and the consumers behave in a normal fashion. We did anticipate maybe a bit more interest in value. And so when we planned for the season, we had a slight nuance towards offering a bit more value, particularly online, and that is driving some good performance overall. So probably a bit more reassuring than might have been the case post budget, and the consumer behaving normally, and we are happy with the business that we started the season with.

In terms of M&A, just to give you some numbers, I mean, at the end for fiscal year '25, business split down in the U.S., 37% of the business was what we bought, then 36% was us having double the value of the acquisitions. So the sales of the acquisitions that we had made and then the balance was effectively from new projects. So as we go forward, over $1 billion now in the U.S., obviously, as we go forward, acquisition remains a key part. We love what we've done with Roberto Coin and Hodinkee, great people, great businesses and great complements to our portfolio. And we have big plans that we'll look forward to updating the market on when the time is right. And we remain active on strategic acquisitions. We have always had and we still do have active discussions that are going on. There's a bit more realism or pragmatism, if you like, with regards to valuations. And we've got a bit confident that acquisitions will be a key part of our growth in the U.S. market.

Share buyback, Anders.

Yes. I mean, obviously, as you've seen, we're guiding towards GBP 65 million to GBP 70 million of CapEx in our existing franchise and new projects during this year. And that whole reset of our network is going to come towards the tail end once we finish off our next fiscal year. And as a result, the need for capital expenditure in that network is going to decline as a percentage of sales as we go forward.

So yes, I mean, we always look at deployment of our capital structure, and we are a growth story, and we continue to focus on that. In case we can't find any way to deploy our funds meaningful with good returns, then yes, share buybacks would be an option. It's something that we always discuss with our Board.

And your last question, so we love the stores that we opened in St. Ann's, the Mappin & Webb branded jewelry store, a fabulous team that we appreciate. Our team did a great job, I think, in recruitment and training of the team, great client response. Sales are building and obviously, the month of December is going to be very important. But clients love the store. They love the downstairs area where we've got hospitality and client engagement, and a fantastic portfolio of brands, many of which have never been available outside of London before. So we feel very good about it.

We'll now move to Kate Calvert of Investec.

A couple for me. First question on Roberto Coin. You mentioned a positive response to the new ranges. Could you give a bit more color on what has gone down well in the new ranges?

And I'm just wondering, how current is the stock in the wholesale channel? I mean is there much old stock in there? Or is it quite clean at the moment from your perspective?

And I suppose I'm quite interested in your sort of slightly wider thoughts on the U.S. jewelry market running into Christmas. I know it's a slightly different offer to Signet, but Signet were recently a bit more cautious on outlook for the holiday season. So I was wondering if you could give a bit more color on that.

And then my final question is on the U.K. that you did see quite a negative mix effect from pre-owned growth, I believe. So as you continue to roll out the Rolex and Pre-Owned should we expect that negative effect to continue into FY '27 or are we past the worst of it?

Okay. Okay. Do you want to comment on there?

Yes. I mean first of all, in terms of the ranges or what's working, quite honestly, everything has been working at the moment in the first half of the year. We've got such a wide range of products and price points. And we're proving it in our own stores first with the space expansions that we've done and elevating of the brand more than doubling the sales in the first half, and we've seen a great positive response to new products that's gone out there as well in terms of aging of product. We have no concerns in that area at the moment, either in our stores or with our partners. And it's just -- we're really still in our infancy in terms of what we can do with Roberto Coin. So we've proven it first in our own stores, but we've more than doubled the sales, and there's a lot more to do just within our own multi-brand environment. We've opened up our first store in Hudson Yards. We open up our second tomorrow, I think, in Vegas. We're going to continue. And I think it's an open door with some of our partners to expand the brand within the wholesale network as well. It just takes time in terms of green spaces and then building out the shop-in-shops.

We've only just launched robertocoin.com. We've seen a positive response to that as the replatforming of that from the old system to Shopify. So a great response to the marketing campaign. So we're very, very optimistic about the brand. I think going through the holiday season, but more particularly in the longer term as we roll out our strategy.

Yes. And the package that we are able to bring to the market are putting great emphasis on the collections that Roberto and his team have designed, the 2 biggest collections are Love in Verona and Venetian Princess, and obviously a good featuring of them in the advertising campaign. So you naturally sell in more on the back of that in the sell-out of those collections, that's also super positive.

The last thing is we have been in a very different market to Signet, I would say. And the luxury branded jewelry market continues to be -- it's the biggest one in the world per capita and in the absolute. We're delighted to be a part of it, and it continues to be very good. So as we've continually said, so far so good on the season, and we are reasonably upbeat about December.

In terms of the U.K. mix question, Kate, obviously, yes, as we've accelerated sort of our presence in the pre-owned business that had an adverse impact on our product margin. I think the step-up that we've seen has been extraordinary in the U.K., which is positive is what we wanted. So I think it's going to slow down in terms of dilution. The offset against which we're doing really well in some of our strategic partner brands. So we've put more emphasis on a brand like Tissot for instance, which is margin accretive. And we see some really good new product initiatives coming through in some of the other brands like TAG. So I think the dilution impact on product margin is going to stabilize.

[Operator Instructions] We'll now go to Melania Grippo of BNP Paribas.

This is Melania Grippo from BNP Paribas. I've got 2 questions. One is on your waitlist. I was just wondering if you have seen any changes in terms of consumer behavior and customer signing on it?

And my second question is instead on price increases for 2026. What's your expectations in terms of brands increasing their prices for both watches as well as jewelry?

On -- sorry, the first question was on registration of interest list. No big change to be honest. In the U.S., we continue to, net-net, add names overall and pretty much all of the business if we so desire in the U.S. could be going to people around the list. I think as we've reported to you before, we have some products in the U.K. that are not fully dependent upon the list. We make some availability of our product in the stores, somewhere between 15% and 20% of the sales that we're now doing is from stock that's in-store, which is a very healthy trend as far as we are concerned. So I mean, demand overall for the brands that we manage through our waitlist remains very, very strong overall.

Price increases, yes, we've got to see what the brand response is going to be to the 15% tariffs. I think it's reasonable to assume that the pricing is going to be an element of it. The 15%, if you're going to recover it all through our retail pricing, it'd be somewhere around 7.5%, 8%, something like that. We really don't know at this point. But I think it's reasonable to assume that pricing is going to be there, will it all be in the U.S. or will it more likely, I think, be a spread in different markets. I think probably that's the case. But we don't assume any pricing in our numbers going forward. But yes, my bet would be that will definitely be pricing activity as it always has in January, but it will take into account the tariff situation.

As we have no further audio questions, [ Scott Lichten ] , we're going to call over to you for any questions submitted by webcast. Thank you.

Thanks very much, George. And we've had a few questions submitted through the webcast. First is from Deborah Aitken from Bloomberg. The question is, U.S. markets, profitability has grown quickly, considering the company is still deep in restructure and expansion. Can you give us your midterm view on profit potential from the U.S. market given it's less mature and with jewelry still to build its share in your total revenue mix there?

What I would say is we really have moved beyond the period of having to build our organization resources in the U.S., support from the U.K. We clearly have done an amazing job to go from pretty much nothing to the $1 billion business that we have today. We have invested in resources with our head office down in Fort Lauderdale and offices up in New York, and a very obvious example of that clearly is localizing the ecom team that we were previously supporting out of the U.K. But we've really added to the resources and the infrastructure and feel very, very good about how the business has been managed on a day-to-day basis. We've obviously got our best man on here, the guy to my right.

But they're really doing a great job. And our team between the U.K. and the U.S. teams, how we've managed the growth of supporting our business and the operational excellence that we achieved, really I'm very impressed by and very, very pleased with. We will, again, we'll talk to the market about where we are headed going forward. We wouldn't give any midterm indications today, but it's 61% of our profits now coming out of the U.S. There clearly has been leverage at the store level with the strength of the market and the market share gains that we've made. And it's a great growth prospect for us both in terms of top line and profitability.

Follow-on question from Deborah. Can you share with us plans with some of your key brands pipeline and projects and timings? And are any areas which have not delivered as expected, which strategy rethink might be sought in fiscal 2027?

Yes. We prefer not to talk about sort of specific projects at a brand level. We have listed the projects that we've got coming up for the current year. Looking at them as a group, we get good paybacks. Overall, it's been a cornerstone of what we've done over this last 10, 11 years, and it continues to be the case. Of course, there will be some projects that don't quite hit the expectations that we had set for. Unfortunately, there are not too many. And if we look at the overall mix of what we've achieved there are more in which we would say we'd probably overperformed versus our financial criteria than underperformed. But we would talk about specific projects that way. If you want to add, Anders?

No. I think, obviously, with the acquisition of Roberto Coin and obviously, we've done the segment reporting, so you can all read. If we can get that brand to accelerate growth, of course, it's very accretive for our profitability. So there's no secret there. So that remains a high-level priority, obviously for us. And we have a few things that we are investing in that currently aren't accretive like an ecom proposition in the U.S. market that today is dilutive for profit, but long term, probably will be accretive as we have it in the U.K. So we'll see.

I think, yes, we're 8 years young in the U.S. Some of our stores are only opened a couple of months. We're continuing to develop our client base. We're continuing to understand better and better what they need. We're continuing to add new clients. We're making sure that for the super high demand product that we have, where we're giving a significant percentage to new clients. So a lot more that we can do to develop that events have been continue to deliver more and more in terms of ROI. We did some fantastic events this year. Brian mentioned the Porsche event, the Venetian Ball that we did with Roberto Coin just at the end of the half.

And there's still some. Brian talked about the growth that we've got from obviously, acquisitions and then how we've developed them. And some of the acquisitions that we've done, we've yet to fully mature. Betteridge, for example, we've refurbished one of the stores in Vail, which is fantastic. But we still have the full story in Greenwich to do. Aspen to do as of yet. And Hodinkee and Roberto Coin are obviously just in very early stages. So just a matter of planning it out and executing it.

Super. We've got -- that's the end of the questions we have at the present time. Maybe, Brian, if we could hand back to yourself for closing remarks.

Okay. Thank you. Thank you, David and Anders, as well, thanks for all your questions. We are really pleased about our first half, pleased about our start of the second half overall. I think it's clear that the category that we're in is a very resilient category that we can see here in the U.K. It's an underdeveloped category in the U.S. I think that's clearly proven and very much responding to investment from us and others in the market and very well positioned for growth. So very happy at what we've done, happy about the start of the second half, delighted with the job that our teams are doing across both our markets, U.K. and U.S. And I appreciate you all joining us this morning. Thank you.