The ongoing impact of macroeconomic externalities, including record gold prices and lower consumption sentiment in mainland China has impacted the overall jewellery business of Chow Tai Fook Enterprises Limited (CTFE), the group revealed recently.
Chow Tai Fook Jewellery Group Limited reported a revenue decrease of 20.4 percent year-on-year in the six-month period ending on September 30th, totaling HK$39.4 billion ($5 billion).
Chow Tai Fook Group is a Hong Kong–based, conglomerate with holdings in the jewellery, property development, hotel, department store, transportation, energy, telecommunications, port, and casino sectors.
CTFE, the parent company of Chow Tai Fook Jewellery, holds a 25 percent interest in the Destination Brisbane Consortium joint venture holding The Star Brisbane casino license.
In a recent report by its jewellery unit, Chow Tai Fook noted that operating profitability remained robust, with gross profit margin improved by 650 basis points to 31.4 percent, attributed to a better retail like-for-like margin amid surging gold prices and a higher contribution from fixed-price gold products.
In response to fluctuating market conditions, the company proactively optimized its product and pricing strategies, introducing offerings across various value propositions.
Notably, sales of fixed-price gold jewellery demonstrated strong performance, with the sales mix and product RSV in mainland China doubling year-on-year to 14.2 percent during this period.
The company also closed a net of three points of sale (POS) in Hong Kong and Macau during the period under review, maintaining a total of 84 POS.
‘This strategic positioning is expected to drive quality earnings growth moving forward. The company plans to continue reassessing business conditions and evaluating individual store performance to ensure sustained success’, Chow Tai Fook added.
‘Looking ahead, with the Central Government progressively rolling out economic stimulus policies, the Group is poised to enhance its competitive edge and position itself for market recovery. The company remains committed to identifying growth opportunities in both existing and new markets, aiming for sustainable growth in the future’, the group added.
