Chinese-headquartered jewellery retailer Chow Tai Fook has reported a 26% decline in retail sales for the three month period ending March 31, 2016 (Q4 of FY 2015-16) while releasing its unaudited operational data for the period. The drop in sales was seen in both value and volume as well as across geographies and product categories.

The jeweller stated that the decline was largely due to weakening consumer demand for luxury items on account of the slowdown in economic growth in China, as well as decline of tourist traffic and weaker local consumer sentiment in Hong Kong and Macau.

In Mainland China, Chow Tai Fook’s retail sales value (RSV) was 25% down year-on-year, significantly below the 6% fall seen in the previous quarter, being additionally affected by the outflow of holiday consumption on account of increased outbound travel, while in HK & Macau retail sales were 26% down.

After factoring in currency fluctuations, RSV of Mainland China and the Group would be down by 21% and 22%, the statement said.

In terms of same store growth (SSG) and same store volume growth, China recorded a 25% fall on both parameters, while HK & Macau saw declines of 27% and 29% in the categories respectively, once again worse than the last quarter which saw a 23% drop.

Gem-set jewellery sales were down 23%, while sales of gold products (which account for 53% of total revenue) dropped 27% for the Group. In the latter segment, China saw a 29% decline.

During the quarter the Group opened a net of two POS, which included a net opening of one Jewellery POS and a net closing of two Watch POS in Mainland China, a net opening of one POS in Hong Kong, Macau and other markets, and a net opening of two Hearts On Fire standalone stores in Taiwan. Net openings during FY2016 were 62, and the total number of POS stood at 2,319 as at 31 March 2016.