Oriental Watch profit plummets
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Listed retailer Oriental Watch Holdings says its net profit fell 78 per cent in the year to March.
The company, which had issued a profit warning earlier in the year, has been hit by the slump in demand for luxury watches from mainland Chinese, in turn a result of the mainland government’s clampdown on gift giving.
OWH says its net profit fell to HK$5 million, (US$641,000) on turnover down 11 per cent to around HK$3.11 billion.
The company said luxury brand shoppers had changed preferences and attitudes and blamed slimmer margins on intense competition from watch retailers competing for a shrinking customer base.
Oriental Watch has 68 stores in mainland China, 13 in Hong Kong, three in Macau and three in Taiwan.
Questions & Answers
Q.What was the main reason for Oriental Watch Holdings' significant drop in net profit?
What was the main reason for Oriental Watch Holdings' significant drop in net profit?
The company's profit was hit by a slump in demand for luxury watches from mainland Chinese customers. This slump is attributed to the mainland government’s clampdown on gift-giving practices.
Q.How much did Oriental Watch Holdings' net profit fall in monetary terms for the year to March?
How much did Oriental Watch Holdings' net profit fall in monetary terms for the year to March?
Oriental Watch Holdings' net profit fell to HK$5 million (US$641,000) for the year. This represents a significant 78 per cent decrease compared to the previous period.
Q.What other factors did Oriental Watch Holdings blame for its reduced profitability?
What other factors did Oriental Watch Holdings blame for its reduced profitability?
The company also blamed changed preferences and attitudes among luxury brand shoppers. Also, intense competition from other watch retailers, vying for a shrinking customer base, led to slimmer margins.
Q.Where are Oriental Watch Holdings' stores primarily located across the region?
Where are Oriental Watch Holdings' stores primarily located across the region?
Oriental Watch Holdings operates 68 stores in mainland China, which is its largest presence. It also has 13 stores in Hong Kong, three in Macau, and three in Taiwan.
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