Chow Tai Fook, a leading jewelry retailer in Hong Kong, reported a record profit attributable to shareholders of 9 billion Hong Kong dollars ($1.15 billion) for the financial year ending in March, marking a more than 50% increase year-over-year. The company's operating profit also rose to 18.9 billion Hong Kong dollars, up 27.8% from the previous year.
The surge in profits is largely attributed to higher gold prices, which improved profit margins, particularly for its weight-based gold products. Karen Yih, the chief financial officer, noted that the demand for design-led products is increasing as China's economy experiences a K-shaped recovery.
She highlighted that high-margin fixed-price jewelry is performing exceptionally well, especially in higher-tier cities and international markets. Chow Tai Fook's guidance for the 2027 financial year exceeded expectations for both sales and margins, with same-store sales growth in April and May also surpassing forecasts.
Citi analysts predict that the company will see net profit margin growth in 2027 due to plans for expanding luxury and self-operated stores, alongside its signature jewelry collections. Despite fluctuations in gold prices, demand for Chow Tai Fook's products remains resilient, which bodes well for its future performance