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Chow Sang Sang Fears Impact of Trade War
Aug 28, 2018 4:33 AM
By Rapaport News
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RAPAPORT... Hong Kong-based jeweler Chow Sang Sang warned that trade tensions may impact its earnings for the remainder of 2018, even after first-half sales grew.
“Though the results of the first half of 2018 looked encouraging, the impact of international trade disputes, the effect of [the US Federal Reserve’s June] interest-rate increase as well as currency revaluation may take their toll in [the second half],” the company said Monday.
Diplomatic tensions between the US and China have led to volatile stock markets
and exchange rates this year, the retailer said. The Chinese yuan
weakened against the Hong Kong dollar in the second quarter, potentially
restricting the spending power of tourists from the mainland visiting Hong
Kong. Chinese economic growth is also slowing, while global conditions
could create further challenges in the coming months, Chow Sang Sang added.
Sales increased 19% to $1.22 billion (HKD 9.56 billion)
for the six months ending June 30 as consumer sentiment remained robust in
greater China despite the circumstances. Revenue from the jewelry-retail
segment grew 23% to $1.1 billion (HKD 8.65 billion), with sales in Hong Kong
and Macau up 24% due to increased tourism. Profit surged 54% to $77.1 million (HKD
605.5 million).
However, a strong performance in the second half of 2017
may also damage the company’s results in comparative terms for the same period
this year, it noted.
The company did not release detailed data for sales
growth in mainland China during the period. The group’s other revenue comes
from businesses such as wholesaling and real estate.
Image: Chow Sang Sang
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Tags:
China, Chow Sang Sang, Greater China, Hong Kong, Hong Kong dollar, Rapaport News, retail, Trade War, Yuan
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