Swatch CEO still sees pickup in 2nd half -paper

ZURICH, July 12 (Reuters) - Swatch Group AG (UHR.VX), the world's largest watchmaker, is still confident demand will pick up in the second half compared with the year-ago period, Chief Executive Nick Hayek was quoted as saying on Sunday.

"For the second half, I expect a positive development compared to the previous year, which was already hit by the crisis. I am also expecting that there will be an improvement compared to the first six months," Hayek told Switzerland's NZZ am Sonntag.

Asked if sales had fallen between 15 and 20 percent in the first half of the year, Hayek said: "You are not bad (with that estimate).

"The first months especially (of the first half) were difficult. Since then the situation has brightened. May was better than the first quarter, June was also a very good month for us -- especially in China, Russia and Britain where we had double-digit growth," Hayek said.

He said he expected production to pick up at the end of October.

Hayek said the group had seen a low-double digit percentage decline in demand for the most expensive brands.

The Swiss watch industry is facing its most severe drop in demand in about two decades as consumers scale back on spending and retailers focus on getting rid of old stock before ordering new goods. Swiss watch exports slipped 25 percent in the first five months of the year. [ID:nLN724067] (Reporting by Katie Reid; Editing by David Holmes)