Luk Fook sales drop 10 per cent as trade war bites
The trade war between the US and China has been partially blamed for a 10 per cent fall in Luk Fook sales.
In a quarterly sales update, the Hong Kong-listed jewellery retailer said a relatively higher base in the comparable period also contributed to the decline.
First-quarter same-store Luk Fook sales were down 10 per cent with the overall same-store sales of gold products down 19 per cent. Gem-set jewellery sales rose 4 per cent.
In Hong Kong and Macau, sales of gold products fell by 20 per cent while gem-set jewellery sales rose 6 per cent.
“The favourable sales performance of lower-value items resulted in a double-digit drop in the average selling price of gem-set jewellery products,” said chairman and CEO Wai Sheung Wong. “However, due to the remarkable increase in sales volume, the same-store sales of gem-set jewellery products still recorded positive growth given a high base.”
Sales on the mainland fell 7 per cent, with gold products down by 4 per cent and gem-set jewellery down by 7 per cent. However, mainland licensed shops recorded a low single-digit same store sales growth.
Luk Fook added a net 35 new Lukfook stores in the mainland during the quarter. As at June 30, the company operated 1861 worldwide, 1790 of those on the mainland.