Chow Tai Fook’s shares jumped more than 5 percent after the jeweler reported relatively strong quarterly sales amid renewed growth in China and higher gold demand.
Retail sales in mainland China increased 7 percent in the third fiscal quarter that ended December 31, while same-store sales advanced 4 percent, the Hong Kong-based retailer reported. Revenue from Hong Kong and Macau fell 6 percent with same-store sales down 2 percent.
Same-store sales of gold rose 7 percent in mainland China and 8 percent in Hong Kong and Macau amid a 10 percent year-on-year jump in the yellow metal’s price. Same-store sales of gem-set jewelry slipped 4 percent in mainland China and slumped 17 percent in Hong Kong and Macau.
The quarterly update, which excluded sales totals, signals a turnaround from the double-digit declines the jeweler reported in the past two years when it was hit by a slowdown in China’s economy and fewer tourist arrivals in Hong Kong.
Chow Tai Fook pointed to “stabilizing fundamentals and a relatively low base of comparison” and said the improving trend was in line with the group’s expectations.
Correction, January 11, 2017: Chow Tai Fook’s third-quarter gold and gem-set jewelry sales figures are same-store sales and not total sales.