Soft gold prices drove stellar second-quarter sales for Hong Kong jeweller Luk Fook Holdings.
In a stock exchange filing, the company said gold sales by weight surged 68 per cent year on year in the three months to September 30 and 124 per cent compared with the same period two years ago. By value, gold sales soared 40 per cent and 105 per cent respectively.
Fixed-price jewellery sales eased 8 per cent year on year, however they were down 89 per cent over two years.
In Mainland China, comp-sales in company-owned stores were down 4 per cent due to stringent anti-pandemic measures, but that was a significant improvement on the first quarter decline of 28 per cent and marked a 62 per cent improvement over the second quarter in FY21. Online sales on the mainland were up by 8 per cent.
Licensed stores, which comprise 97 per cent of physical retail business, recorded a 2 per cent sales decline with a 6 per cent improvement in gold sales not enough to compensate for a 19 per cent decline in fixed-price jewellery.
Subsequent to the end of the quarter, the increasing severity of the pandemic and the tight restrictions on pandemic prevention, saw overall same-store sales in mainland shops decline at a double-digit rate during the first two weeks of this month.
Despite these challenges, Luk Fook is continuing to rapidly expand its store network on the mainland, adding a net 121 outlets during the quarter, adding 95 under its Lukfook banner and 31 under the Heirloom Fortune chain. The store network in other markets remained unchanged.