Strong Holiday Demand Spurs Chow Tai Fook Sales

Sales rose at Chow Tai Fook in the fourth fiscal quarter as the Hong Kong-based jewelry retailer saw increased holiday purchasing and the return of visitors to the municipality.

“During the fourth quarter, both mainland China and Hong Kong and Macau were benefited from strong festive demand,” the company said Friday. “In Hong Kong, the continued recovery of inbound tourism has been supportive to our business.”

Retail sales grew 12% for the three months that ended March 31, reflecting a 12% increase in China and a 13% hike in other markets, the jeweler reported. Despite being headquartered in Hong Kong, Chow Tai Fook derives most of its revenue from the mainland — around 89% for the quarter.

The border between Hong Kong and China reopened in January 2023, although the return of visitors was slow to build in the first quarter of that year. Since then, inbound tourism has been growing. Much of Hong Kong’s luxury-sector revenue comes from Chinese tourists, who visit the municipality to purchase goods. Additionally, the Chinese Lunar New Year took place between February 10 and 24. It is traditional to purchase gold products for the holiday.

Same-store sales in Hong Kong and Macau — at shops that had been open for a year — rose 4.5%. On the mainland, sales slipped 2.7% by this measure, which excludes franchise stores. The drop in the mainland was due to a high comparison base, with most Chinese consumers still purchasing domestically at the start of 2023, versus traveling to Hong Kong this year.

Gold jewelry performed better than gem-set pieces in both geographical segments, up 3.4% in China and 17% in Hong Kong. Gem-set jewelry fell 20% on the mainland and 27% in the municipality.

RELATED READING

Holiday, Tourism Boom Buoy Hong Kong Luxury Sales

Main image: A Chow Tai Fook store in Hong Kong (Shutterstock)