Chow Tai Fook Forecasts 90-100% Profit Surge

Chow Tai Fook Jewellery Group forecasts a net profit increase of approximately 90-100% for the first half of fiscal year 2027, compared to the same period last year. This substantial rise is primarily attributed to a fair value gain from the revaluation of gold loan contracts, reversing a loss recorded in the prior period, alongside improved sales performance in key markets.

Operational data for the second quarter, ending September 30, 2026, reveals a 0.5% decrease in overall Group Retail Sales Value (RSV). However, this aggregate figure masks significant regional divergence. Mainland China experienced a 5.3% decline in RSV, while Hong Kong & Macau saw a robust 33.2% increase. Same Store Sales (SSS) growth mirrored this trend, with Mainland China reporting a 2.2% increase and Hong Kong & Macau achieving a substantial 29.6% gain. Within Hong Kong and Macau, weight-based gold jewellery saw a 43.5% increase in SSS, while fixed-price jewellery increased by 13.0%.

The company’s RSV analysis indicates that weight-based gold jewellery accounted for 67.5% of total RSV during the quarter, while fixed-price jewellery contributed 29.2%. Mainland China saw a 25.6% year-on-year growth in e-commerce RSV, representing 8.9% of total Mainland RSV and 19.8% of volume. The group continues to optimize its retail network, closing 240 stores in Mainland China during the quarter while adding one store in Hong Kong, Macau, and other markets.

The positive profit alert signals a significant financial turnaround, driven by the favorable revaluation of gold loan contracts and strong performance in the Hong Kong and Macau markets. While overall retail sales experienced a slight decline, the resilience of the brand transformation and strategic focus on key markets appear to be driving improved profitability. The regional divergence in sales performance suggests a complex operating environment and highlights the importance of targeted strategies for different markets.