CHOW TAI FOOK-周大福(01929) - 2024 - 年度财报

Financial Performance - Revenue increased by 14.8% to HK $108,713 million, or by 18.5% on a constant exchange rate basis[9] - Core operating profit increased by 28.9% to HK$ 12,163 million[9] - Core operating profit margin improved by 120 basis points to 11.2%[9] - Revenue for the year ended 31 March 2024 is HKD 108,713 million, with a gross profit of HKD 22,285 million[16] - Core operating profit for the year ended 31 March 2024 is HKD 9,439 million, with a core operating profit margin of 10.0%[16] - Net profit margin for the year ended 31 March 2024 is 5.8%, with a full year dividend payout ratio of 92.9%[16] - Revenue increased by 14.8% to HK $108,713 million in FY2024[30] - Core operating profit (COP) grew by 28.9% to HK$ 12,163 million, with an operating margin of 11.2%[30] - Profit attributable to shareholders rose by 20.7% to HK $6,499 million, with earnings per share of HK$ 0.65[30] - The Board proposed a final dividend of HK $0.30 per share, bringing the full-year dividend to HK$ 0.55 per share, with a payout ratio of 84.6%[30] - Revenue increased by 14.8% to HK $108,713 million in FY2024, with constant exchange rate growth reaching 18.5%[87][88] - Mainland China revenue grew by 9.9%, contributing 82.5% to the Group's total revenue, with constant exchange rate growth of 14.1%[88] - Hong Kong, Macau, and other markets revenue surged by 45.6% due to the recovery in inbound tourism[88] - Gold jewellery and products revenue increased by 22.5%, contributing 82.0% to the Group's revenue, up by 510 basis points[91][92] - Gem-set, platinum, and K-gold jewellery revenue declined by 13.3% due to macroeconomic challenges, but quality jewellery remained favored by customers[92][93] - Adjusted gross margin decreased by 90 basis points to 22.8%, partially offset by optimized pricing strategies and rising gold prices[85] - Main operating profit increased by 28.9% to HK$ 12,163 million, with the operating profit margin rising by 120 basis points to 11.2%[85] - The Group's net profit attributable to shareholders grew by 20.7%, despite unrealized losses from gold borrowing due to gold price fluctuations[85] - Core operating profit for FY2024 increased by 28.9% YoY to HK $12,163 million, with a margin of 11.2%[99] - Adjusted gross profit margin decreased by 90 basis points to 22.8% in FY2024, mainly due to higher sales contribution from gold jewellery and wholesale business[104] - Unrealised loss on gold loans amounted to HK$ 2,489 million as of 31 March 2024, due to timing differences in gold price fluctuations[103] - Revenue for 2HFY2024 increased by 22.9% YoY to HK $59,187 million, while adjusted gross profit rose by 8.5% to HK$ 12,988 million[98] - Mainland China contributed over 85% of the Group's core operating profit in FY2024[98] - SG&A expenses as a percentage of revenue decreased by 3.0 percentage points to 12.1% in 2HFY2024[98] - Profit attributable to shareholders increased by 20.7% in FY2024, partially offset by unrealised losses on gold loans[99] - The Group's core operating profit margin expanded to 12.1% in 1HFY2024, up 2.8 percentage points YoY[98] - Adjusted gross profit for 1HFY2024 increased by 12.9% YoY to HK $11,786 million, with a margin of 23.8%[98] - The average London gold price for FY2024 showed a YoY increase, impacting the Group's gold inventory valuation[105] - SG&A expenses decreased by 2.9% to HK$ 13,300 million, with the SG&A ratio improving by 230 basis points to 12.2%[107] - Revenue in Mainland China increased by 9.9% to HK $89,698 million, with wholesale revenue growing by 15.1% (19.6% on a constant exchange rate basis)[108] - The company had 5,679 franchised CHOW TAI FOOK JEWELLERY POS as of 31 March 2024, contributing approximately 63% of wholesale revenue in Mainland China[109] - SSSG of gold jewellery and products was strong at 6.4%, with ASP increasing to HK$ 5,600 (FY2023: HK $5,200)[112] - ASP of gem-set jewellery increased to approximately HK$ 8,100 (FY2023: HK $7,600)[113] - Adjusted gross profit margin decreased by 80 basis points in FY2024, primarily due to higher sales contribution from wholesale business and gold jewellery and products[115] - Wholesale business mix increase led to a 70 basis points drop in adjusted gross profit margin, while gold jewellery and products revenue mix surged to 82.5% (FY2023: 77.8%)[115] - Core operating profit increased by 23.4% in 1HFY2024 and 16.1% in 2HFY2024, with core operating profit margin improving by 2.5 percentage points in 1HFY2024[114] - Adjusted gross margin decreased by 80 basis points in FY2024, primarily due to the increased contribution from wholesale business and gold jewelry sales, which offset the improvement in retail product gross margin[116] - Wholesale business gross margin is lower than retail. In FY2024, the increased wholesale mix led to a 70 basis points decline in adjusted gross margin. The surge in gold jewelry demand pushed its revenue mix to 82.5% (FY2023: 77.8%), resulting in a 120 basis points decline in adjusted gross margin[116] - SG&A ratio was 11.4% for the period ended 31 March 2024, with fixed expenses contributing around 50% to SG&A expenses in FY2024 (FY2023: approximately 45%)[116][117] - Core operating profit margin increased by 90 basis points to 11.7% in FY2024[116] - Staff costs and related expenses decreased slightly by 0.3% in FY2024, with fixed component increasing 3.8% YoY due to annual salary increments, while the variable component decreased 3.9% due to adjustments in back-office staff remuneration[117][118] - Concessionaire fees ratio declined to 7.7% due to a shift in sales mix towards gold jewelry and products, which generally have lower concessionaire rates[120] - Lease-related expenses ratio decreased slightly by 30 basis points during FY2024[120] - Total retail points (POS) for Chow Tai Fook Jewelry in Mainland China increased to 7,403 as of 31 March 2024, with a net addition of 143 stores during FY2024[122] - Overall retail sales value (RSV) increased by 17.3% YoY in FY2024, driven by a 23.3% increase in gold jewelry and products, while gem-set, platinum, and K-gold jewelry RSV declined by 5.9%[123] - E-commerce RSV grew by 18.8% YoY in FY2024, contributing to the overall RSV growth across all channels[126] - Brick-and-mortar stores accounted for approximately 95% of the company's RSV in Mainland China during FY2024[127] - Mainland e-commerce RSV grew by around 20% in FY2024, with e-commerce share of retail sales volume exceeding 10% and ASP increasing to HK$ 2,080 (FY2023: HK $1,870)[127] - RSV YoY growth in Tier I cities was +17.7%, Tier II cities +18.1%, Tier III cities +15.5%, and Tier IV cities +17.7% in FY2024[129] - Franchised POS RSV in Mainland China increased by 23.4% YoY in FY2024, with franchised stores comprising approximately 77% of the total store count[133] - The company opened a net of 143 CHOW TAI FOOK JEWELLERY POS in Mainland China during FY2024, primarily in franchised format and located in shopping malls[132] - Stores aged less than two years contributed approximately 65% of overall Mainland RSV per Same Store in FY2024, the highest level in recent years[135] - 2HFY2024 contributed approximately 55% of annual SSS, reflecting normal seasonality post-pandemic[137] - Shopping mall RSV grew by +21.0% YoY in FY2024, with a net increase of 167 POS[131] - Retail revenue surged by 40.4% in FY2024, driven by the return of Mainland tourists, while wholesale revenue increased by 85.6% due to the rebound of duty-free business in Hainan Province[140] - Same-store sales growth (SSSG) in Hong Kong and Macau climbed 42.4% in FY2024, with gold jewellery and products leading at 67.7% SSS growth, supported by a 17.3% increase in ASP to HK$ 8,100[142] - Adjusted gross profit margin decreased by 130 basis points to 24.4% in FY2024, primarily due to higher sales contribution from gold jewellery and products[146] - Core operating profit escalated by 153.7% to HK $1,654 million in FY2024, with the corresponding margin rising 370 basis points to 8.7%[146] - SG&A ratio decreased by 570 basis points to 16.4% in FY2024, benefiting from favorable operating leverage[146] - Staff costs and related expenses increased by 9.4% in FY2024, but the ratio dropped by 250 basis points to 8.7% due to faster revenue growth[151] - Lease-related expenses increased by 15.3% in FY2024, with the ratio decreasing by 100 basis points to 4.1%[152] - Fixed staff costs rose by 8.7% year-on-year, driven by revisions to staff remuneration packages, while variable staff costs increased by 12.3% due to higher retail revenue[151] - Total retail points increased from 133 in FY2022 to 145 in FY2024, with a net addition of 10 points[155] - RSV (Retail Sales Value) in Hong Kong and Macau surged by 32.0% and 53.2% respectively in FY2024, driven by the recovery of inbound tourism[161][162] - RSV in other markets jumped 118.9% in FY2024, supported by new store openings and strong demand in duty-free shops in Hainan and Southeast Asia[161][162] - Gold jewellery and products saw a significant RSV YoY increase of 69.4%, with weight-based gold products accounting for 84.7% of RSV in FY2024[157][160] - Gem-set, platinum, and K-gold jewellery experienced a RSV YoY decline of 3.7%, while watches saw a 7.0% decrease[157] - Diamond jewellery's share of RSV decreased from 71.0% in FY2023 to 64.4% in FY2024, while other gem-set jewellery increased from 15.5% to 20.2%[158] - Other income decreased by 6.0% YoY to HK$ 690 million in FY2024, primarily due to lower government grants and commission income[168] - Net foreign exchange loss increased by 4.0% YoY to HK $330 million in FY2024, driven by RMB depreciation[169] - Finance costs on gold loans rose by 41.8% YoY to HK$ 357 million in FY2024, reflecting higher borrowing costs[170] - Taxation increased by 8.4% YoY to HK $2,121 million in FY2024, driven by higher taxable profits[170] - Bank interest income decreased by 19.6% in FY2024 due to relatively lower average bank deposit balances[171] - Finance costs on gold loans increased by 41.8% in FY2024 due to higher average gold loan outstanding by weight[171] - Net profit margin increased to 6.1%, and ROE rose by 820 basis points to 24.7%[172] - Inventory balances (excluding packaging materials) increased by 9.2% to HK$ 64,593 million as of 31 March 2024[176][177] - Inventory turnover period reduced by 20 days compared to FY2023, reaching 204 days when excluding franchisee-held inventory[176][177] - Franchised POS held approximately HK $16,535 million or 25.6% of total inventory balances as of 31 March 2024[176][177] - Total borrowings increased by HK$ 7,683 million, with gold loans rising by HK $9,402 million to HK$ 24,488 million[178] - Bank deposits and cash equivalents decreased by HK $4,039 million to HK$ 7,695 million as of 31 March 2024[178] - Net debt increased by HK $11,721 million to HK$ 20,928 million, representing 78.2% of total equity[178] - RMB depreciation negatively impacted the company's profit due to translation differences between spot and closing exchange rates[183] - Revenue YoY change increased by 14.8% as reported and 18.5% on a constant exchange rate basis for the year ended 31 March 2024[186] - Core operating profit YoY change increased by 28.9% as reported and 33.1% on a constant exchange rate basis for the year ended 31 March 2024[186] - Changes in inventory balances increased by 9.0% as reported and 11.4% on a constant exchange rate basis for the year ended 31 March 2024[186] - Changes in bank deposits and cash equivalents decreased by 34.4% as reported and 31.9% on a constant exchange rate basis for the year ended 31 March 2024[186] - Operating cash flows before movements in working capital increased to HK $15,491 million for the year ended 31 March 2024, up from HK$ 11,619 million in 2023[188] - Capital expenditure for FY2024 amounted to HK $963 million, a decrease from HK$ 1,982 million in FY2023[190] - Dividends paid increased to HK $12,538 million for the year ended 31 March 2024, up from HK$ 5,079 million in 2023[188] - Net cash used in inventories decreased to HK $829 million for the year ended 31 March 2024, down from HK$ 6,304 million in 2023[188] - Pro forma free cash flows increased to HK $11,064 million for the year ended 31 March 2024, up from HK$ 6,174 million in 2023[188] - The Group did not have any material contingent liabilities as at 31 March 2024 and 31 March 2023[191] Market and Regional Performance - Revenue in Hong Kong, Macau, and other markets climbed 45.6% year-on-year due to recovery in inbound tourism[9] - Same-store sales growth (SSSG) in Mainland China was +1.8%[14] - Net movement in retail points (POS) in Mainland China was +143, totaling 7,403 stores[14] - Revenue growth in other markets was +42.4%[14] - Mainland China same-store sales growth (SSSG) was 31.9% in 2021, compared to (15.1)% in 2020 and 11.1% in 2022[20] - Mainland China retail sales volume increased from 12,699,000 units in 2020 to 23,774,000 units in 2023[20] - Hong Kong & Macau SSSG showed a significant recovery, reaching 24.7% in 2022 and 18.3% in 2023, compared to (38.7)% in 2020[20] - Total retail points expanded from 3,978 in 2020 to 7,646 in 2023, with Mainland China accounting for 7,510 of the total in 2023[20] - In Mainland China, the company remains confident in the jewellery market due to supportive policies and the Guochao trend, with a GDP growth target of around 5%[35] - In Hong Kong and Macau, store traffic increased, but spending remained prudent, prompting efforts to enhance customer experience across omni-channel touchpoints[35] - The company anticipates opportunities in Southeast Asia from the rising middle class and economic growth, with plans to strategically expand the retail network[36] - SSS (Same Store Sales) in Mainland China increased by 1.8%, while franchised POS sales grew by 7.4% due to the steady ramp-up of younger stores[94] - SSS in Hong Kong and Macau grew by 42.4%, with Hong Kong and Macau individually growing by 40.0% and 50.9% respectively[95] - Mainland China contributed over 85% of the Group's core operating profit in FY2024[98] - The company had 5,679 franchised CHOW TAI FOOK JEWELLERY POS as of 31 March 2024, contributing approximately 63% of wholesale revenue in Mainland China[109] - Total retail points (POS) for Chow Tai Fook Jewelry in Mainland China increased to 7,403 as of 31 March 2024, with a net addition of 143 stores during FY2024[122] - Overall retail sales value (RSV) increased by 17.3% YoY in FY2024, driven by a 23.3% increase in gold jewelry and products, while gem-set, platinum, and K-gold jewelry RSV declined by 5.9%[123] - E-commerce RSV grew by 18.8% YoY in FY2024, contributing to the overall RSV growth across all channels[126] - Brick-and-mortar stores accounted for approximately 95% of the company's RSV in Mainland China during FY2024