Hong Kong retailer Luk Fook has reported an impressive revenue increase in the fourth quarter off the back of the rising popularity of gold jewellery.
Luk Fook – which operates more than 3,500 stores worldwide – announced a five per cent increase in sales as tourism continues to ramp up.
Sales in Hong Kong and Macau improved by 10 per cent for the three months ending 31 March. In mainland China, sales increased by nine per cent.
“Since the demand for diamond products remains subdued in the mainland, the group will continue to actively promote non-diamond fixed-price jewellery products in order to enhance the performance of fixed-price jewellery products,” the company said in a statement.
“Moreover, the ongoing improvement in macroeconomic conditions will help to boost the business growth of the Hong Kong and Macau markets.”
The statement continued: “Furthermore, the high gold price will affect sales performance in the short term, but this could also help to improve the group’s gross margin. Sales will be recovered while gold prices become normalised.”
Same-store sales of gold jewellery increased by 4 per cent, while revenue from fixed price diamond jewellery decreased by 37 per cent. The retailer opened 230 new stores during the quarter.
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