Hong Kong-based Chow Sang Sang reported that group revenues, including its retail and wholesale divisions, rose 47 percent year on year to $2.21 billion (HKD 17.16 billion) in 2011. Sales were driven by growing demand in Mainland China for luxury products, the company explained. Profits increased 45 percent to $143.2 million (HKD 1.11 billion).
Chow Sang Sang’s jewelry retail sales rose 53 percent year on year to $1.63 billion (HKD 12.65 billion) during the year. The company explained that its sales in Hong Kong and Macau reached record levels boosted by strong tourist arrivals from Mainland China. Sales in Mainland China accounted for one-third of total revenues.
Chow Sang Sang’s wholesale division saw sales rise 31 percent to $559 million (HKD 4.34 billion).
The company stressed that inflation-curbing measures in China and other cautionary signals did not deter mainlanders from spending, whether they were at home or in Hong Kong. Chow Sang Sang maintained a positive outlook for 2012 despite economic uncertainties and high gold prices.
“Although uncertainties abound in 2012, we believe that gold and jewelry will continue to be favored by mainlanders,” the company explained. “There are forecasts that gold may reach the $2,000 level, but it is difficult to predict how consumers will react to such a price.”
As a result, the company stressed that inventory levels are being carefully monitored, with priority given to close tracking of replenishment to sales.
The value of the company’s inventory rose 27 percent through the year to $800.3 million (HKD 6.21 billion) as of December 31, 2011. The group ended the year with cash of $81.3 million (HKD 631 million), which was triple the amount on hand at the end of 2010.
Shares in Chow Sang Sang rose 2.5 percent to HKD 19.7 a share in Hong Trading on Tuesday.