Emperor Watch & Jewellery Ltd. (00887.HK) is planning new retail outlets overseas to cater to mainland tourists, while remaining prudent about business expansion in Hong Kong.
Chairperson Cindy Yeung told reporters in Hong Kong Tuesday that her firm is in discussions to open new stores in duty-free areas in Seoul and Jeju Island in South Korea, as well as in places such as Malaysia and Thailand.
“We will continue to identify other Asian markets following Singapore, or even places outside Asia. We hope to capture the consumption market of Chinese tourists in different countries,” she said.
There is “a lot of potential” in Chinese tourists, Yeung said, noting that middle-class mainlanders are increasingly opting to travel abroad.
Apart from other nations, Emperor Watch will also add about 10 stores in China’s second- and third-tier cities, including Zhengzhou in Henan province and Suzhou in Jiangsu province.
Most of the outlets will be jewelry shops.
Meanwhile, Yeung said the company will be prudent about opening new stores in its home base of Hong Kong.
The retailer may even close a major outlet at Russell Street in Causeway Bay if the rent becomes too high, she said. The current lease is said to expire in September.
Emperor Watch & Jewellery announced Tuesday a 52.4 percent decline in net profit for 2014 to HK$138 million.
Revenue dropped 10.6 percent to HK$5.93 billion. Revenue from the watch segment, which contributed to more than 80 percent of the total sales, dropped by 6.2 percent while that of the jewelry segment slumped by 25.7 percent.
Yeung attributed the weak performance to the ongoing austerity drive in the mainland and the Occupy street protests in Hong Kong in the last quarter of 2014 had an impact on the results.
But she said the retail market for luxury products will improve in 2015 as some consumers who earlier used to shop in Europe are likely to return to Hong Kong following global price adjustments in luxury brands last year.
In 2014, Hong Kong contributed more than 80 percent of Emperor Watch’s total revenue, dwarfing the company’s three other markets — Macau, Mainland China and Singapore.
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