business
Chow Tai Fook Shares Rise 15% After Record Annual Profit, Though Operating Profit Growth Lagged
The Hong Kong jeweler posted a record HK$9 billion net profit for the year ended March, up 50% from a year earlier. Higher gold prices and demand for fixed-price jewelry drove the gains.
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Chow Tai Fook shares rose 15% on Friday after the company reported a record profit for the financial year that ended in March. 14 billion, up 50% from the prior year. 9 billion Hong Kong dollars.
Chief financial officer Karen Yih said higher gold prices lifted margins and gross profits on weight-based gold products. She added that the company is also benefiting from demand for its design-led items as China's economy follows a K-shaped recovery.
"Our high-margin fixed-price jewelry sells exceptionally well," Yih told CNBC's Squawk Box Asia, citing strong sales in higher-tier Chinese cities and international markets.
She noted that demand for these products tends to remain resilient even when gold prices fluctuate. Guidance for the 2027 financial year exceeded expectations on both sales and margins, according to a Citi note issued Thursday. Same-store sales growth in April and May also came in stronger than expected, helped by a recovery in weight-based gold jewelry after gold prices pulled back.
Citi estimated that Chow Tai Fook could expand net profit margins in 2027 through additional luxury and self-operated stores and its signature jewelry collections. Gold prices rose sharply from late 2025 into early 2026 as investors sought safety amid macroeconomic and geopolitical uncertainties, then fell about 20% after the start of the Iran war. 38% higher.
