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Luk Fook’s Profit Plunges 41%

Jun 23, 2016 10:20 AM   By Rapaport News
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Luk Fook’s sales slumped and profit plummeted in fiscal 2016 as the company joined a string of jewelers hit by a Chinese economic downturn and fewer tourist arrivals in Hong Kong.

Revenue dropped 12 percent to $1.81 billion (HKD 14.03 billion) and net income plunged 41 percent to $123.9 million in the year to March 31. The group’s Hong Kong sales fell 14 percent to $1.06 billion, in line with the company’s profit warning earlier this month.

Tourism to Hong Kong declined because of a macro-economic downturn, the company said. The strong U.S. and Hong Kong dollars relative to the Renminbi weighed on sales, as did the increased popularity of other destinations such as Japan and Korea due to more favorable exchange rates for visitors.

Chow Tai Fook, another Hong Kong-based retail jeweler, saw annual profit tumble 46 percent. Chow Sang Sang’s Hong Kong and Macau jewelry sales slid 10 percent in 2015 but a stronger performance in mainland China helped limit the dip in the company’s revenue to 1 percent.

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Tags: asia, China, Greater China, Hong Kong, Jewelry, Luk Fook, Rapaport News, retail
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