Chow Tai Fook plans China expansion
With a rebound in Chinese purchases of luxury products, Chow Tai Fook Jewellery plans to add up to 100 new retail locations on the mainland.
Executive director Adrian Cheng Chi-kong says the group wants to open 70 to 100 more stores in Mainland China in the next financial year, mainly in third-tier and other cities. This follows it opening three retail locations, in Malaysia, South Korea and the US, last year to capture growing opportunities among mainland tourists.
“As a long-term initiative, we will reach out to wholesalers in the US, given our well-established relationship with retailers,” Cheng says.
In the past financial year, Chow Tai Fook closed seven shops in Hong Kong and Macau while opening others on the mainland, resulting in a gain of 67 outlets over the period. The company had 2381 retail locations at the end of March.
Resurgent demand on the mainland, which accounted for more than three-quarters of the retailer’s earnings, helped deliver 14 per cent growth in its core operating profit for the second half of the financial year.
The jeweller’s net profit for the 12 months to the end of March rose 3.9 per cent year on year to HK$3.06 billion (US$390 million), while revenue fell 9.4 per cent to $51.2 billion, compared with a 12 per cent decline the previous 12 months.