Nasdaq-listed Kingold Jewelry has reported a decline in sales of about 10 per cent, and a halving of its gross profit for last year.
Kingold, one of China’s leading manufacturers and designers of high quality 24-karat gold jewelry, ornaments and investment-oriented products, has reported net sales of US$1 billion compared to $1.1076 billion the previous year. It says the decline was due to the decrease in total sales volume, decrease in the average unit selling price and loss in currency exchange rate.
Gross profit decreased to $38.3 million compared to $76.3 million, and gross margin was 3.8 per cent compared to 6.9 per cent. The company said the substantial decrease in gross profit was primarily due the decrease in gold prices, less sales in gold volume and less customised production sales during 2015.
“In 2015 we faced challenges from declining market price of gold which negatively impacted the company’s customers’ purchase of gold and the pressure from delayed construction progress of our Jewelry Park due to harsh weather along with the Chinese New Year,” said chairman and CEO Zhihong Jia.
“We anticipate that the Jewelry Park will be finished in April 2016, and the Jewelry Park will serve as a platform to further accelerate Kingold towards the goal of becoming a leading 24-karat gold products designer, manufacturer, and a sizable supplier in Greater China.”
The company’s net income was US$21.6 million, compared to $47.3 million in 2014.
Notably, however, net sales rallied in the fourth quarter: $280.8 million, compared to $209.3 million, but net income for the period fell from $8.1 million to $5.6 million.
