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Hong Kong Jeweler Tse Sui Luen’s Profit Dives 40%

May 24, 2016 6:59 AM   By Rapaport News
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RAPAPORT... Tse Sui Luen, a Hong Kong-based jeweler, reported revenue declined and profit plummeted in the past fiscal year as fewer tourists from mainland China dampened retail activity.

Sales dropped 8.6 percent to $455.6 million (HKD 3.54 billion) and profit nosedived 40 percent to $3.1 million in the 12 months to February 29. Hong Kong and Macau revenue slumped 24 percent to $218.3 million, outweighing a 13-percent jump in mainland China sales to $231.2 million.

The continuing political uncertainty in Hong Kong, the devaluation of the Renminbi and austerity measures introduced by the mainland government negatively affected tourist arrivals, the company said. These circumstances also hit consumer confidence and purchasing power. Even among those who did choose to fork out on jewelry, the consumption pattern shifted from high-end products to popular mass-market commodities, Tse Sui Luen said.

The company’s consolidated gross margin dropped by 1 percentage point to 45.5 percent as high rental levels in Hong Kong and Macau compounded the retailer’s troubles.

The results come after Chow Tai Fook, another jewelry retailer headquartered in Hong Kong, warned its profit is expected to have slumped by 40 to 50 percent in the three months to March 31 because of weaker consumer sentiment in Greater China.
Tags: China, Hong Kong, jewelers, Jewelry, Rapaport News, retail, retailers, Tse Sui Luen
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