Chow Tai Fook H1 net profit falls 33 pct as costs rise, sales slow

HONG KONG Thu Nov 29, 2012 3:26am EST

HONG KONG Nov 29 (Reuters) - Chow Tai Fook Jewellery Group Ltd, the world's biggest jewellery retailer by market value, posted a 33 percent fall in six-month profit on Thursday due to a drop in sales amid slower economic growth in China, higher operating costs and losses on gold hedging.

The Hong Kong-listed company, which competes with Cartier , Tiffany & Co and local firms like Luk Fook Holdings (International) Ltd, posted a net profit of HK$1.82 billion for the six months ended in September, compared with HK$2.69 billion a year earlier.

That compared with an average forecast of HK$2.18 billion from five analysts polled by Reuters.

Chow Tai Fook this month warned that it expected its gross profit margin to fall 2-3 percent during the six-month period due to gold hedging activities as the price of gold increased.