Chow Tai Fook Jewellery Group Limited ("Chow Tai Fook" or the "Company"; collectively with its subsidiaries, the "Group", HKEx stock code: 1929), the world's largest jeweller by market capitalisation with 85 years' heritage, holds a grand production inauguration ceremony for its development project Chow Tai Fook Jewellery Park ("Jewellery Park") in Wuhan, Hubei in celebration of the commencement of production upon completion of the first phase production facilities of the project's first stage of construction. To commemorate this special occasion, Chow Tai Fook Chairman Dr. Henry Cheng, together with some senior management, flew to Wuhan to officiate at the inauguration ceremony with a number of senior government officials of Wuhan City and Huangpi District. Witnessed by hundreds of business partners and guests from near and afar, it set a new milestone for sustainable development of the Group in future decades.
Chow Tai Fook management officiating at the ceremony included Chairman Dr. Henry Cheng, Managing Director Kent Wong, Executive Director Conroy Cheng, Executive Director Chan Sai-Cheong, Finance Director Hamilton Cheng, Executive Director Peter Suen, Non-Executive Director Koo Tong-Fat, Corporate Planning Deputy General Manager Lau King-Ming and Head of the Group's Production Management Centre Daniel Tam.
Chow Tai Fook Jewellery Park is a multi-billion-dollar long-term development project. Chow Tai Fook Chairman Dr. Henry Cheng said in his speech, "The Jewellery Park is an important decision made in respect of the Group's development strategy. With its well-structured overall planning, the Jewellery Park serves as an integrated production and development base, comprising 6 main functions, namely jewellery production, logistics and distribution, sales exhibition and tourism, training, e-commerce and jewellery business support. Each complements with one another and together they will generate synergies, bringing new momentum and diversified benefits to further strengthen our vertically integrated business model, enhance the capacity and efficiency of our supply chain, increase production capacity, further increase the proportion of in-house production, support retail business for sustainable development and deepen collaboration with business partners, thus keeping us in pace with the growing jewellery retail market and supporting our sustainable development in the coming decades."
Wuhan, with favourable geographical and economic conditions and abundant supply of talents, is the focal point of Mainland China. It flourishes as a comprehensive transportation and logistics hub, as well as an industrial base in Central China. In 2013, the GDP of Wuhan reached RMB905 billion, ranked No.9 among all cities across Mainland China. With regard to education, Wuhan is the third largest education centre and nurtures talents through a mass of vocational schools, higher education institutes and universities, providing the Group with a stable source of talents with diversified professions and expertise. Wuhan also enjoys fast economic growth; its expanding consumption power per capita makes it a promising market. Establishment of Chow Tai Fook Jewellery Park in Wuhan will benefit the Group's manufacturing and retail businesses. It will further sharpen the Group's overall competitive edges, resulting in enhanced business expansion and long-term development in Mainland China.
The construction work of the Jewellery Park is progressing well. The land parcel currently under construction is 220,000 square metre-large, with a gross floor area of 436,000 square metres, on which 8 buildings have been erected with topping-out nearing completion. These buildings comprise 4 production plants, 1 production testing centre, 2 staff quarters and 1 staff canteen. Upon production operation to commence, the Jewellery Park targets to reach an annual production capacity of one million jewellery pieces by the end of Financial Year 2015.
"The planning and development of the Jewellery Park have been closely adhered to 5 guiding principles, namely automated mechanisation, smart technology, low carbon environment, people-oriented approach, as well as simplicity and contemporary design concept, equipping the Group with a smartly integrated platform that is highly efficient, innovative, environmental friendly and conducive to sustainable development. The entire value chain is taken as a core part in the overall planning of the Jewellery Park, hence covering not only production, logistics, sales exhibitions, training, but also the robust e-commerce as well as a jewellery business support centre to bring in business partners all along the whole supply chain. This will serve to provide strong support to the development of the Group's operation and the industry as a whole", according to Chow Tai Fook Managing Director Kent Wong.
An investment of HK$2.6 billion has been allocated for the first phase of the project that has specific plans, of which HK$130.2 million were already spent. As at 31 March 2014, around 77% was land and construction cost while 23% was production and office equipment expenditures.
Chow Tai Fook opened its first point of sale in Mainland China in Beijing in 1998 and has since then achieved substantial growth in this market, which has now become the Group's major market. For Financial Year 2014, Mainland China accounted for 54.5% of the Group's total revenue. The retail network of Chow Tai Fook comprises more than 2,100 points of sale, with nearly 95% of them located in Mainland China.