Chinese jewellery giant Chow Tai Fook has more than doubled its annual profit after a one-off Covid-19-related rent concession and gains on gold holdings and foreign exchange.
At US$776.65 million, the profit is the group’s highest since the 2014 financial year and up 107 per cent on last year’s.
Sales for the latest financial year surged 23.6 per cent to $9 billion, a 41.3-per-cent decline in Hong Kong and Macau offset by a 32 per cent increase on the mainland.
Chairman Dr Henry Cheng Kar-Shun said the company is optimistic about the mid- to long-term growth in the Mainland China market, and will focus on developing that part of the business in the future.
“On one hand, we will continue our retail expansion strategy through penetrating into lower tier cities and leveraging franchisees’ local knowledge,” he said in the results announcement. “On the other, we will push forward our smart retail strategy through enhancing the retail experience and focusing on O2O channel integrations to take advantage of digital transformation.”
He said while Covid-19 has heavily impacted sales in Hong Kong and Macau, those markets have bottomed out and the situation will gradually improve when borders reopen.
The retail network expanded to 4591 points-of-sale by the end of March, with a net addition of 741. The company plans to add at least 700 more in Mainland China during the current financial year, but may close 10-15 in Hong Kong and Macau.