Zheng Yutong'S Retirement Impact On Big Chow Tai Fu Performance Fell 13% Across The Board.

< p > "in three years, I have the confidence to double the turnover of Zhou Dafu."

This is Zheng Jiachun's commitment to investors a year ago by Chairman Zhou Dafu.

"There is no denying that the base of the 2011-2012 fiscal year is too high, and the consumption climate in the mainland is very low. It is impossible for Zhou Dafu to achieve a high growth rate of over 70% every year. The doubling of 3 years or 6 years is only a medium and long-term goal. It depends on the average, focusing on the gains and losses of a year."

This is Zheng Jiachun's "defense" today.

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< p > as Zheng Yutong's first pcript after retirement, Zhou Dafu's performance has declined all the way.

The profit attributable to shareholders was HK $5 billion 500 million, down 13.2% from the same period last year, and the same store sales fell by 3.3%. The gross profit margins and operating profit margins fell by 0.3 and 1.8 percentage points respectively, mainly due to the sale of high priced jewellery.

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< p > HSBC analysis, Zhou Dafu's highest gold price hedging coverage in the industry can minimize the impact of the plunge in gold prices on the cost of inventories, coupled with the surge in gold sales, and this year's net profit will rise by 32%, but gross margins will continue to suffer.

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< p > < strong > "mainland myth" fade > /strong > /p >

< p > February 2012, Zheng Yutong, the 86 year old jewel king of the world, retired two times and his eldest son Zheng Jiachun took over.

Its annual performance was called "mainland myth", and its net profit increased by 79.23% to HK $6 billion 300 million. In addition, the mainland customers made up 77.6% of the total revenue of the mainland.

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Less than P, however, this year's business figures have gone back sharply.

The annual report shows that the same store sales in the mainland dropped by 3% compared to the same period last year, and the growth rate reached an astonishing 48.4% during the same period last year.

Compared with the expansion rate of new stores, 269 new businesses opened in mainland China last year, and 209 new stores opened this year.

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Zheng Bingxi, group finance director, explained: "the slowdown in sales in the mainland is mainly due to the weak desire for consumption in the whole retail sector, as well as the slowdown in wholesale business, especially the sale of high-end jewellery."

The mainland's efforts to crack down on public consumption have a negative impact on the consumption of expensive gifts.

But the Group expects that urbanization will drive sales growth in the sub developed areas of the mainland, and will continue to expand.

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< p > Zheng Jiachun added that this year plans to open retail outlets in three or even four tier cities, and plans to increase the total number of stores to more than 2000 in the next fiscal year, an increase of 16%-17% compared to the same period. With the growth of 7%-8% sales, this year's sales revenue is expected to return to 20%.

HSBC jewelry retail analyst Lina Yan analyzed in the latest report that Zhou Dafu has passed the most difficult time, and the same store sales have bottomed out since last December.

As the biggest winner of gold rush buying in 4 and May, net profit is expected to jump by 32% on a low base effect, up 8% compared with the 2012 fiscal year.

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< p > < strong > "Chinese aunt" save life < /strong > /p >

< p > "to a certain extent, Zhou Dafu is the winner of this round of gold price collapse.

Hedging high coverage to avoid cost loss, "Chinese aunt" grab gold frenzy has greatly stimulated the same store sales.

Lina Yan told this newspaper that the current downside risk lies in whether too hot gold sales will occupy a higher profit margin for jewellery sales.

It is reported that the gross profit margin of Zhou Dafu gold sales is between 15%-18% and jewellery sales is up to 40%.

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< p > Zhou Dafu, managing director of Huang Shaoji, revealed that gold prices dropped to $1320 in April, and indeed led to the consumption of gold ornaments, which showed a rapid year-on-year increase for 2 consecutive months. The specific increase will be announced in the first quarter of 3 weeks.

"Gold price drop brought joy to the group. During the period, sales of high-grade jewellery did not decline.

Gold prices continue to fluctuate, favorable for the growth of retail sales of gold jewelry in the mainland, and the group will regularly examine the proportion of gold hedging, temporarily maintaining 70%.

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< p > he said: "the gold price drop brought the unexpected joy to the group. During the period, the sales of high-grade jewellery did not decline.

Gold prices continue to fluctuate, favorable for the growth of retail sales of gold jewelry in the mainland, and the group will regularly examine the proportion of gold hedging, temporarily maintaining 70%.

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< p > reporter understands that Zhou Dafu is the jewellery dealer with the most hedge against gold price in all trades, and up to 70% of inventory is protected by hedging tools.

In short, gold prices drop by 1% and inventory costs increase by only 0.3%. Rival Lufu jewelry has only about 20% of gold stock hedged.

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< p > fund manager Huang Guoying introduces that the business mode of gold shop is to earn the difference and additional value, not to fry gold, but to maintain certain stock for operation.

Because the accounting standard adopts FIFO, the early price will be used when calculating the cost. When the price of gold falls sharply, it will have an effect on the profit of the year, and at the same time, the stock on hand will be cheaper and cheaper.

If the price of gold rises again, it will release disposable reserves for a long time.

"Unless the price of gold is down, jewelers may need to calculate the one-time Book loss and calculate the difference between the stock and the spot, which can offset the profit for half a year."

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< p > overall, the weak gold prices affect short-term data, but the profit reserves buried on the balance sheet will also rise correspondingly.

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