Hong Kong retailer King Fook Jewellery Group recorded a profit growth for the financial year ending March 31, owing to increased sales to luxury consumers.

In its earnings report, the company said profits rose to HK$5.7 million (around US$734,000) from HK$770,000 (around US$99,000) in the previous year while revenues reached HK$615.7 million (US$79.43 million) from HK$551.9 million (US$71.19 million) a year ago.

“The group’s increase in revenue was mainly contributed by sales growth from local high-end customers in the first three quarters of the year,” King Fook said. 

Revenues were up 20.5 per cent in the first three quarters of the year but saw a 14.8 per cent decline by the fourth quarter due to the coronavirus outbreak.

Towards the end of fiscal year 2020, Hong Kong has been adversely affected by an ongoing US-China trade dispute, the social unrest in Hong Kong and the Covid-19 pandemic. Tourist arrivals have dropped significantly since August last year and were down to almost zero in April 2020, the company said. 

As of end-March, the group had seven shops in Hong Kong. Revenues from retail sales of gold ornaments, jewellery, watches, and gifts accounted for HK$592 million (US$76.38 million) of the total results.

Weak market conditions in Hong Kong however are expected to continue, according to the group. 

“Hong Kong’s luxury retail market will take time to recover. Kingfook will enhance its competitiveness by cautiously reviewing and adjusting its store locations, operating costs, and product mix to better address the changing needs of tourists and the local market,” said King Fook Chairman Richard Tang.