Story Highlight
– Partners Group confident despite Breitling’s €1.5 billion debt.
– CEO Georges Kern focuses on long-term brand building.
– S&P downgraded Breitling’s debt rating to B-.
– Breitling’s sales dropped 11% to CHF 769 million.
– Retail expansion includes 300 boutiques under new ownership.
Full Story
Partners Group, the private equity firm that owns Breitling, has expressed confidence in the financial stability of the watchmaker, despite pressure to manage significant debt across several portfolio companies. This assurance comes in light of looming refinancing obligations amounting to billions of euros for Breitling and two other firms in which Partners Group holds investments.
Ben McLean, managing director for private equity at Partners Group, clarified the situation in a recent statement: “These three businesses are not in a stressed situation. We are confident in the numbers.”
Georges Kern, CEO of Breitling, echoed this sentiment during an interview at Geneva Watch Days, stating, “I am not worried,” when queried about the company’s debt, which S&P Global estimates at nearly €1.5 billion.
Reports suggest Partners Group faces a challenging timeline to refinance approximately €6 billion in debt across its investments, including Breitling, French property services firm Emeria, and industrial conglomerate Ammega. These companies have significant loans that will mature in 2028, with current trading levels reflecting credit stress.
It is important to note that the €6 billion in question does not appear on Partners Group’s balance sheet directly but is attributed to the leveraged positions held within its portfolio companies. Partners Group currently manages assets exceeding $186 billion.
The firm acquired Breitling in a 2022 deal that increased its ownership from 25% to a controlling stake of over 50%. This transaction valued the company at $4.5 billion and was executed with London-based CVC Capital, which had purchased Breitling from the Schneider family in 2017, previously hiring Kern as CEO. When CVC acquired the brand, it was reportedly valued at around $900 million.
While Breitling is not mandated to disclose its financials publicly, Bloomberg reported a drop in sales by 11%, reaching CHF 769 million for the year ending March 31, 2026. Adjusted EBITDA also fell, decreasing by 21% to CHF 162 million. S&P Global downgraded Breitling’s debt rating to B- in July, attributing this decline to ongoing underperformance and weakened credit metrics linked to reduced consumer demand.
Current projections from S&P Global indicate that the company’s debt-to-EBITDA ratio could rise above 9x in fiscal 2026, with a slight improvement anticipated the following year. The credit agency expects revenues to remain subdued, estimating a decline to between CHF 760 million and CHF 770 million for 2026, down from an estimated CHF 782 million in 2025.
Morgan Stanley and LuxeConsult forecasted Breitling’s revenue for 2025 at approximately CHF 820 million. The brand’s financial journey illustrates a complicated backdrop tied to its rapid growth. Under private equity management, Breitling expanded its retail presence to roughly 300 boutiques and invested heavily in product enhancement and marketing campaigns.
Despite this growth, the valuation of Breitling has reportedly diminished, with CVC marking it down to around half the value established during the 2023 transaction and Partners Group valuing its stake at approximately 0.7 times its investment.
In 2018, Breitling ranked as the 17th largest Swiss watchmaker, with estimated sales of CHF 360 million. By 2022, it had advanced to the ninth position with sales of CHF 870 million, a status it maintains today. In the UK specifically, reports indicate a steeper revenue drop from nearly £90 million in FY2023 to below £60 million recently.
Under Kern’s leadership, Breitling has transformed its image beyond a manufacturer of pilot watches to one that features a diverse range of collections across core categories, alongside a more inclusive offering for women. Sales strategies have modernised as well, reflected by the launch of many boutiques featuring a contemporary design, operated directly or through partnership agreements with various retailers.
The brand has secured endorsements from high-profile personalities, including Brad Pitt and Charlize Theron, as well as partnerships with noted brands such as Aston Martin and the NFL. Despite these marketing efforts and rising average product prices, sales growth has stagnated since 2022.
Partners Group faces its own financial hurdles this year, with its shares declining about one-third in 2026 and a reported 13% drop in first-half profits, totalling CHF 502 million. Additionally, CEO David Layton has announced plans to step down at the start of 2027, transitioning to the role of Chief Investment Officer. The leadership will then shift to co-CEOs Roberto Cagnati and Juri Jenkner.
