Hong Kong jeweller Luk Fook Holdings Ltd said annual profits rose 36.8 per cent on the back of a more favourable retail sentiment in Hong Kong and Macau.

The company said net income for the year ending March 31, 2024, reached HK$1.76 billion (about US$225.28 million) while revenues were up 28 per cent to HK$15.32 billion (approximately US$1.96 billion). Revenues from Hong Kong and Macau rose 52.4 percent while those in mainland China fell 2 per cent.

Lukfook also ended the year with a net margin of 11.5 per cent, up 0.8 percentage points from fiscal year 2023.

“Following borders reopening in Hong Kong, Macau and mainland China early last year, the retail sentiment has shown continuous improvement,” explained Lukfook. “Furthermore, leveraging the low base effect and outperforming gold sales, retail business achieved satisfactory results especially in Hong Kong and Macau.”

Growth was mainly driven by sales of gold products, it added.

During the year, the group added 478 new stores globally, which brings its global network of shops to 3,583 across Hong Kong, Macau, mainland China, Malaysia, Cambodia, the Philippines, Laos, Thailand, the US, Canada and Australia.

Golden prospects 

Gold and platinum products saw a 50.7 per cent rise in sales to HK$10.37 billion (around US$1.32 billion) while those of fixed-price jewellery were down 3.1 per cent. Overall, sales rose 30.8 per cent year on year.

According to Lukfook, gold products remain highly sought after amid a yearly 10.2 per cent increase in the prices of gold per ounce. Gold and platinum items accounted for 72.6 per cent of overall sales from just 63 per cent last year, making it a key driving force in Lukfook’s retail business. 

Meanwhile, sales of fixed-price jewellery products dipped to HK$3.91 billion (approximately US$500.46 million) mainly due to declining demand for diamond products. 

With subdued appetite for diamond products likely to remain in mainland China, the group is aiming to promote non-diamond fixed-price jewellery products. It also expects sales of gold items to normalise once consumers have adapted to high gold prices. 

Counting on improved macroeconomic conditions and recovery in retail sentiment, Lukfook remains upbeat about its mid- to long-term business prospects in mainland China. “The group will continue to expand in the mainland market and still expects to see a positive growth in shop number in the coming year,” the company added. “Apart from that, the group is optimistic about the immense growth potential in overseas markets, too.”

Lukfook is looking to further expand its global footprint and open approximately 15 shops overseas in 2025.