Luk Fook‘s annual profit surged on higher revenue, benefiting from low base effect and the reopening of borders in Hong Kong, Macau, and Mainland China.

The jeweller’s attributable profit surged 37.6 per cent to HK$1.77 billion (US$226.3 million) as revenue grew 28 per cent to HK$15.33 billion.

Hong Kong, Macau and overseas revenue swelled 52.4 per cent to HK$10.04 billion, however in Mainland China, revenue slid 2 per cent to HK$5.29 billion.

Retailing revenue soared 45.3 per cent to HK$12.75 billion, representing 83.2 per cent of the group’s total revenue, primarily driven by the sales of gold products.

However, wholesaling revenue fell 28.3 per cent to HK$1.54 billion due to continued sluggish demand for diamond products in Mainland China.

The company noted that the increase in gold reserves among central banks and ongoing worldwide geopolitical tensions have spiked gold prices again in March.

Due to this, the company witnessed a same-store sales decline 35 per cent in Hong Kong and Macau and a decrease of 20 per cent in mainland China from April to June 21.

The company expects gold product sales to return to normal levels when consumers have adapted to the high prices.

Meanwhile, Luk Fook intends to actively promote non-diamond fixed-price jewellery products to improve the performance of fixed-price jewellery products.