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Luk Fook's 1H Revenue +70%, Profit +72%

Strong gold product sales trigger revenue growth.
Dec 1, 2013 7:28 AM   By Deena Taylor
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RAPAPORT... Hong Kong-based jeweler Luk Fook Holdings reported that revenue rose 70 percent year on year ‎to $1.3 billion (HKD 10.06 billion) in the six months that ended on September 30. Group profit ‎jumped 72 percent to $124.5 million (HKD 965.5 million).

The surge in revenue was driven by strong sales of gold products, which the company noted was a favorite item among customers that,  together with platinum,  accounted for 72 percent of the group's total sales. Gold sales were triggered by a large drop in gold prices in April and again in June. Gem-set jewelry products accounted for 28 percent of total sales.

Luk Fook’s retail sales in Hong Kong, Macau and overseas accounted for the majority of ‎revenue and rose 82 percent year on year to $1.11 billion (HKD 8.64 billion). The company’s wholesale ‎division experienced a sales increase of 16 percent to $141.9 million (HKD 1.10 billion). Sales from its ‎licensee partners rose 3 percent to $41.6 million (HKD 323 million)‎.

The group's overall same-store sales growth grew 62 percent. Same-store sales in Hong Kong rose 58 percent and 96 percent in Macau. Gold and platinum product same-store sales soared 87 percent, while same-store sales for gem set jewelry products rose 16 percent.

At the close of the six month period, Luk Fook operated 135 retail stores under the brand name Lukfook ‎Jewellery and 1,053 licensee shops. The group opened its first flagship store in Wuhan in Mainland China and its largest flagship store worldwide in Macau.

Additionally, the group signed a memorandum of understanding with Hong Kong Resources Holdings (HKRH) to buy a 50 percent stake in its fully owned subsidiary, China Gold Silver Group (CGS), for $38.8 million (HKD 301 million).

Tags: Deena Taylor, gold, Jewelry, Luk Fook Holdings, Lukfook Jewellery
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