November 21, 2017 / 10:44 AM / 24 days ago

UPDATE 1-Hong Kong jeweller Chow Tai Fook says H1 profit up 46 pct, to open more mainland stores

(Adds company comments, earnings figures, Hong Kong retail sales)

* First-half revenue up 15 pct

* H1 same-store mainland jewellery sales up 10.3 pct

* To open net 140-150 mainland points of sale through March

By Donny Kwok

HONG KONG, Nov 21 (Reuters) - Chow Tai Fook Jewellery Group Ltd, the biggest jeweller in Chinese territories by market value, on Tuesday reported a 46 percent profit rise in the first half and said it aims to continue expanding in mainland China in the second.

The Hong Kong company said at an earnings briefing it aims to open 35 to 45 more points of sale on the mainland in October-March, on top of 105 opened in April-September, in response to improving consumer sentiment and opportunities from new shopping malls.

“FY2018 will be a turning point for our business given the nascent jewellery market recovery,” Chairman Henry Cheng said in a Hong Kong stock exchange filing. “Although the recovery is gradual and mild, the industry is expected to return to stable yet sustainable growth.”

Chow Tai Fook nevertheless expects a net closure of four to five points of sale in Hong Kong and Macau in the financial year ending March 31.

As at the end of September, the firm’s retail network - including China, Hong Kong, Macau and Taiwan - stood at 2,488 points of sale, 107 more than at the end of March.

BEST FIRST-HALF

Chow Tai Fook reported April-September net profit of HK$1.78 billion ($227.89 million), its best first-half result since the year beginning April 2015. The result compared with a Thomson Reuters SmartEstimate of HK$1.73 billion.

Revenue rose 15 percent from the same period a year earlier to HK$24.75 billion.

Same-store sales of jewellery in mainland China rose 10.3 percent, while those in Hong Kong and Macau rose 9.5 percent. For the full year through March, the firm said it expects high single-digit growth.

In its home base of Hong Kong, retail sales grew in September at the fastest year-on-year pace in over 30 months, government data showed, as increasing numbers of mainland visitors helped boost spending, particularly on watches and jewellery.

Chow Tai Fook shares have risen more than 42 percent in 2017, outpacing a 32 percent gain in the benchmark index. (Reporting by Donny Kwok; Editing by Christopher Cushing)

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