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‘Sudden slowdown’ in Hong Kong

Stelux Holdings, parent of watch retailer City Chain, eyewear retailers Optical 88 and eGG, has reported a “sudden slowdown” in Hong Kong at the end of 2014.

In a statement to the Hong Kong Stock Exchange, Stelux said group sales of HK$974.6 million in the three months to December 31 represented a decline of 2.4 per cent year-on-year. It described the market conditions as “challenging”.

“Our (Chinese) mainland watch retail operations saw turnover growth of around 20 per cent whilst the growth momentum from our eGG business in Greater China was sustained, but other business units generally saw turnover decline.”

While the company did not venture reasons for the Hong Kong decline, other listed companies have recently cited Occupy Central protests and a shift in the origin of tourists from the mainland for their sales declines.

Stelux said its unaudited consolidated group turnover for the nine months to December 31 was HK$2,974.9 million, up 2.8 per cent from the previous corresponding period.

“In the first and second quarters, the group achieved satisfactory turnover growth driven by our Greater China watch and optical retail businesses, particularly our operations in Hong Kong and Macau as our SEA business was affected by the poor retail climate.

“However, in the third quarter we have seen a sudden slowdown in Hong Kong and Macau.

“Moving into the fourth quarter, we expect consumer sentiment to remain soft in all the regions where we operate.”

The group’s total store network grew from 652 to 666 during the period.

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