Luk Fook Growth Reflects China Recovery

RAPAPORT… Luk Fook recorded
an increase in same-store sales in its second fiscal quarter, driven by strong
performances in mainland China and Hong Kong after a prolonged revenue decline.




Same-store sales grew 17% year on year in the
three months that ended September 30, powered by a robust performance at its
outlets in mainland China, where same-store sales were up 11%, the Hong Kong-based jeweler reported. Gold jewelry same-store sales in China rose 19%, while gem-set jewelry dipped 2%. 



In Hong Kong and Macau,
gold jewelry sales were up 21%, while gem-set jewelry sales grew 18%, resulting
in overall same-store sales growth of 18%.




Luk Fook marked an
initial turnaround in the fourth fiscal quarter that ended March 31, when the
company recorded its first quarterly same-store sales growth in three
years. The improvement has influenced the company to revive its store expansion program. 



During
its fiscal second quarter, Luk Fook’s network grew by a net 33 stores in mainland
China, including nine self-operated shops and 24 licensed ones. The improved
market led the group to increase its target net addition of stores from 50 branches
to 80 in mainland China for the 2018 fiscal year.



As at September 30, Luk Fook had 216
self-operated shops, including 151 in mainland China, 45 in Hong Kong, 10 in
Macau and 10 overseas. Including licensed outlets, its global store count
numbered 1,542.

Image: Carlo Villarica