Oriental Watch (398) H1 2026 earnings summary

Executive summary

• Revenue for the six months ended 30 September 2025 declined 10.1% year-over-year to HK$1,618 million, reflecting cautious consumer spending and a slowdown in the luxury market.

• Gross profit dropped 12.9% year-over-year to HK$488 million, with gross margin slightly down to 30.2% from 31.1%.

• Profit attributable to owners decreased 15.1% year-over-year to HK$101 million.

• The Group operated 40 retail points in Greater China and maintained a strong focus on cost control and operational efficiency.

Financial highlights

• Net cash from operating activities was HK$183 million, down from HK$240 million in the prior year period.

• Cash and cash equivalents stood at HK$979 million as of 30 September 2025, up from HK$836 million at 31 March 2025.

• No bank loans outstanding; gearing ratio remained at nil.

• Inventory reduced by 4.3% year-over-year to HK$446 million.

• Interim dividend of 5.3 HK cents per share and special dividend of 15.5 HK cents per share declared.

Outlook and guidance

• The luxury goods market is expected to remain under pressure due to subdued discretionary spending and macroeconomic uncertainties.

• The Group will focus on strengthening brand partnerships, expanding boutique networks, and maintaining stringent cost management to support sustainable profitability.

• Emphasis on premium service and selective new store openings to enhance customer loyalty and market reach.