Hong Kong jeweler Luk Fook expects profit to be down by 50% year on year in its first fiscal half.
The drop is the result of a “significant” increase in losses from gold hedging, while sales of the products made with the yellow metal declined due to record high prices, the company said last week. In comparison, earnings for the six months that ended September 30, 2023, jumped 43% to HKD 942.6 million ($121.1 million), amid a post-Covid-19 tourism revival and strong gold sales.
Meanwhile, sales of diamond products in China and Hong Kong remain weak.
However, the company noted that the adjusted decrease in profit for the period would narrow to less than 30% if the impact of gold-hedging losses was excluded.
Luk Fook will report its full results for the April-to-September period later this month.
Image: A Luk Fook store in Hong Kong. (Shutterstock)
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