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Emperor W&J Announce 2011 Annual Results Revenue Ups by 43.1% Net Profit Surges 91.6%

Mar 19, 2012

* * *

Financial Highlights (Audited):

HK$ ‘million FY2011 FY2011 FY2010 Changes
  Per Reported Excluding the net loss on
derivative financial instruments*
Revenue 5,862 5,862 4,095 + 43.1%
Gross Profit 1,686 1,686 1,048 + 60.9%
Gross Profit Margin 28.8% 28.8% 25.6% + 3.2 pts
EBITDA 825 834 456 + 82.9%
EBITDA Margin 14.1% 14.2% 11.1% + 3.1 pts
Net Profit 627 636 332 + 91.6%
Net Profit Margin 10.7% 10.8% 8.1% + 2.7 pts
Basic EPS HK9.70 cents HK9.90 cents HK6.20 cents + 59.7%
Dividend per Share HK2.80 cents HK2.80 cents HK1.77 cents + 58.2%

*Net loss on derivative financial instruments is a non-cash item going through P&L which is in relation to the issuance of convertible bonds. All of the convertible bonds have been converted into equity shares in Feb 2011 already.


(Hong Kong, March 19, 2012) Emperor Watch & Jewellery Limited (the “Group” or “Emperor W&J”) (Stock code: 887), a leading retailer of luxury watch and fine jewellery, today announces its 2011 annual results for the year ended 31 December 2011 (the “Year”) and the appointment of Ms. Cindy Yeung as the Chairperson.


Thanks for the expansion of market demand for luxury goods and substantial increase of purchasing powers of mainland visitors, the general performance for the Year was encouraging. During the Year, the Group reported revenue of HK$5,862 million, representing an increase of 43.1%.

Emperor W&J Announces 2011 Annual Results
19 March 2012


The Hong Kong market continued to be the key revenue contributor, taking up 83.0% of the Group’s total revenue. During the Year, the revenue contribution from the jewellery sector further increased to 17.6% (2010: 15.4%) during the Year. Due to the continuous contribution of jewellery business as well as the increase of retail price of watch and diamond during the Year, the overall gross profit margin performance further increased to 28.8% (2010: 25.6%).


Excluding the net loss on derivative financial instruments, EBITDA increased substantially by 82.9% to HK$834 million and the profit for the Year attributable to the owners of the Company surged by 91.6% to HK$636 million. Basic earnings per share were HK9.9 cents. Emperor W&J proposed an final dividend of HK1.60 cents per share. Together with the interim dividend of HK1.20 cents per share, the total dividend per share for the Year was HK2.80 cents.


As at 31 December 2011, the Group had 80 stores in Hong Kong, Macau and the PRC. The Group’s retail stores in Hong Kong are strategically located at the major high-end shopping places, namely, Russell Street in Causeway Bay, Canton Road and Nathan Road in Tsimshatsui. Russell Street is now recognized as one of the most expensive shopping area in the world, in terms of shop rental rate per square feet. With the lead of iconic flagship store located in 1881 Heritage, the Group can capture the local shoppers as well as mainland visitors.


As the Group focused its resources on the store roll-outs in the PRC during the Year, the number of mainland stores had increased to 57 as at 31 December 2011, covering the first-tier and second-tier cities including Beijing, Guangzhou, Shanghai and Chongqing so as to seize the potential growth opportunities and enhance the Group’s market penetration in those regions.

In addition, dedicated to the continuous efforts of the Group on the growth of business performance and enhancement of investor communication, the Group was awarded by Asia Money Magazine as 2011 Hong Kong Best Managed Companies Award (Small-Cap).


Meanwhile, the board of directors of Emperor W&J (the “Board”) is pleased to announce that Ms. Cindy Yeung has been appointed as the Chairperson of the Board with effect from 19 March 2012.


Ms. Cindy Yeung, Chairperson of Emperor W&J, said, “In view of the increasing number of the mainland visitors to Hong Kong and Macau, we are confident to have a further solid growth in Hong Kong and Macau’s operations and therefore we are determined to enhance the presence in the main tourist areas in these regions. We will capitalize the growth potential in the PRC by further expanding its retail networks by both raising its market coverage in first-tier cities and seizing first or earlier advantages in lower-tier cities. Meanwhile, we will continue to enhance jewellery business for a better outcome in its dual business models and better marginal performance.”


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Emperor W&J Announces 2011 Annual Results
19 March 2012


About Emperor Watch & Jewellery Limited
With long establishment history of 70 years in Hong Kong since 1942, Emperor W&J is a leading retailer principally engaged in the sale of European made luxurious international branded watches, and self-designed fine jewellery products under its own brand, “Emperor”. Through its extensive retail network in Hong Kong, Macau and China at prime locations, comprehensive watch dealership and unique marketing campaigns, Emperor W&J established a strong brand image amongst its target customers ranging from middle to high income group from all over the world.


For more information, please visit:
Investor/Media Enquiries
Ms. Ally Cheung, Assistant Manager,
Investor Relations Department of Emperor Group
Tel: +852 2835 6791 / 9602 6021

Ms. Anna Luk, Associate Director,
Investor Relations Department of Emperor Group
Tel: +852 2835 6783 / 6184 0181

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