FY2024Q4 Chow Tai Fook's retail sales in mainland China grew 12.4% year on year: Chow Tai ?$#@$ released FY2024Q4 business data (that is, corresponding to the natural year 2024 Q1, same below). Among them, retail sales in mainland China grew 12.4% year on year, and retail sales in Hong Kong, Macao and other regions grew 12.8% year on year. FY2024Q4
FY2024Q4 same-store sales in mainland China declined year-on-year due to a high base for the same period last year, and same-store sales in Hong Kong and Macau grew 4.5% year on year: Looking at the same stores, FY2024Q4 retail sales in mainland China fell 2.7% year on year, mainly due to the high FY2023 base. Retail sales in Hong Kong and Macau grew 4.5% year on year, mainly due to the continued recovery of inbound tourism driving the company's sales performance.
Demand for the company's gold products is strong. FY2024Q4 mainland gold jewellery and products contributed 84.8% of retail sales: by product, FY2024Q4 sales of gold jewellery and products in mainland China grew 3.4% year on year; sales of jewellery, platinum and K gold jewellery in the same store fell 19.5% year on year; sales of gold jewellery and products in Hong Kong and Macau grew 16.6% year on year; sales of jewellery, platinum and K gold jewellery in the same store fell 27.2% year on year. FY2024Q4 Mainland China's gold jewellery and products contributed 84.8% of retail sales. Gold jewellery and ornaments with a “dragon” theme were popular with consumers, and jewellery, platinum and karat gold jewellery contributed 12.4% of retail sales.
The company continues to focus on controlling and improving the operating efficiency of channel stores: On the channel side, the company focuses on controlling the operating efficiency of stores and eliminating less efficient stores. FY2024Q4 closed 89 Chow Tai ?$#@$ jewelry retail stores in mainland China, and a net increase of 1 Chow Tai ?$#@$ jewelry retail store in Hong Kong and Macau. As of the end of March 2024, the Group had a total of 7,548 retail outlets for Chow Tai ?$#@$ jewellery and 234 retail outlets for other brands. FY2024 Group has opened a net of 143 Chow Tai ?$#@$ jewellery retail outlets in mainland China and a net of 10 Chow Tai ?$#@$ jewellery retail outlets in Hong Kong, Macao and other regions.
The operating efficiency of newly opened franchise stores is impressive, improving the overall retail sales performance of franchise stores: FY2024Q4 retail sales of Chow Tai ?$#@$ Jewellery franchise stores in mainland China increased 18.3% year on year, and their contribution to mainland retail sales increased to 70.4%, an increase of 3.2 pcts year on year.
Profit forecast and investment rating: Chow Tai ?$#@$ is the leading brand of gold and jewellery in China. The contribution of opening new stores is gradually becoming prominent. Considering that FY2024Q4 partially closed, we lowered the company's FY2024-FY2026 net profit from HK$84.75/99.7/11.95 billion to HK$75.9/87.4/9.9 billion. The latest closing price corresponding to FY2024-FY2026 PE was 15/13/11 times, maintaining the “buy” rating.
Risk warning: Same-store sales recovery falls short of expectations, store opening falls short of expectations, risk of store adjustments, risk of large fluctuations in gold prices, weakening consumption, etc.