China Growth Rescues Chow Tai Fook Sales

RAPAPORT... Sales at Chow Tai Fook were down only slightly in the first fiscal half,as growth in the Chinese market offset a downturn in Hong Kong. Revenue fell 0.6% year on year to HKD 29.5 billion ($3.77billion) in the six months ending September 30, the company said Thursday. Totalsales in mainland China rose 12% during the period, as the Hong Kong-basedjeweler expanded its store network. Same-store sales - at branches open for atleast year - grew 1.8%. Sales in China made up 69% of the group's revenue, thecompany said. Meanwhile, total sales in Hong Kong and Macau dropped 20% aspolitical unrest and rising gold prices weakened consumer sentiment. Same-storesales for the region plunged 28%, excluding licensed shops. Group profit fell 21% to HKD1.58 billion ($201.8 million). "Mainland China continued to be our main contributor, andaccounted for around 81% of the group's core operating profit, while Hong Kong,Macau and other markets registered a significant decline in core operatingprofit by 26% due to the uncertain situation in Hong Kong," the company noted. Gold sales in mainland China slipped 2% on a same-storebasis, and plummeted 33% in Hong Kong and Macau. Sales of gem-set jewelry rose4.1% on the mainland, but slid 25% in Hong Kong and Macau. During the period, Chow Tai Fook opened a net 333 newlocations in mainland China, and three in Hong Kong and Macau. Image: A Chow Tai Fook store in Hong Kong. (Chow Tai Fook)