Biel / Bienne (Switzerland), February 7, 2012

• Gross sales exceed CHF 7 billion for the first time to CHF 7 143 million, an increase of +21.7% over 2010 at constant exchange rates.
• More than 2800 new jobs created in 2011 alone.
• Operating profit of CHF 1 614 million, an increase of +12.4% on 2010. Operating margin increases from 23.5% to a strong 23.9% despite the negative currency environment and the sharp rise in commodity prices.
• Net income up +18.1% to CHF 1 276 million.
• Equity over CHF 8 billion for the first time, equal to an equity ratio of 82.3%.
• Proposed dividend increase of 15%, CHF 5.75 per bearer share (2010: CHF 5.00) and CHF 1.15 per registered share (2010: CHF 1.00).
• Another successful start in January 2012 with double-digit growth in the Watches & Jewelry segment despite the high benchmark from the previous year.

Group Overview

For 2011, the Swatch Group has record numbers at all levels to post once again. Despite the ongoing difficult currency environment, gross sales were up 21.7% on a currency-adjusted basis to CHF 7 143 million. The continued weakness in the euro and the dollar during the year had a major negative impact on sales of about CHF 700 million.

Improvements in efficiency and the Group’s traditionally strong cost controls helped increase its operating profit for the year under review by 12.4% to CHF 1 614 million, despite an unfavorable trend in foreign exchange rates and the sharp rise in the price of gold and diamonds, two important commodities for us. The operating margin of 23.9% was able to beat the good level from the prior year. Overall, the Group posted record results, with its net income up 18.1% over the prior year to CHF 1 276 million.

Equity of CHF 8 071 million, with an equity ratio of 82.3%, confirms the continuity of the Group’s extremely solid financing. The average return on equity was a considerable 16.8% (previous year: 16.5%). The Swatch Group generated an operating cash flow of CHF 705 million despite an increase in inventories, for the expansion of the own distribution network on the one hand, and for strategic commodities such as precious metals and diamonds on the other hand. Furthermore, approximately CHF 580 million were used for investing activities. During the year under review, the Swatch Group created more than 2800 new jobs, which raised the number of employees worldwide to over 28 000.

The Board of Directors of the Swatch Group will propose the following dividend for 2011 to the Annual General Meeting on 16 May 2012: CHF 5.75 per bearer share and CHF 1.15 per registered share. This increase in the dividend payment to shareholders of 15% versus the previous year is a result of the record results achieved in 2011 and underscores the optimistic outlook for business performance going forward in 2012.

Outlook for 2012

The Swatch Group is well prepared for the future and is maintaining its clear and healthy long-term growth strategy. We expect growth to continue in 2012, although this is more and more challenging due to the high benchmark. The Swatch Group will also continue to make targeted investments in 2012 in its worldwide distribution network and in its production capacities in Switzerland across all segments, despite the strong Swiss franc.