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Family business roundup: Empire, Chow Tai Fook grow, while Paris Orleans and Fiat see falls

Some of the largest and most famous family businesses in the world, such as Canada’s Empire Company, Hong Kong’s Chow Tai Fook and the Rothschild family’s Paris Orleans, reported vastly contrasting results in the last week.

Some of the largest and most famous family businesses in the world, such as Canada’s Empire Company, Hong Kong’s Chow Tai Fook and the Rothschild family’s Paris Orleans, reported vastly contrasting results in the last week.

Empire Company, the holding group controlled by the Sobey family, said on 28 June that sales rose to $16.25 billion (€12.91 billion) for the year ending 5 May 2012, up from around $15.9 billion the previous fiscal year.

Net earnings at the company, which operates in the retail and real estate sectors, also increased to $320.6 million from around $300 million the year before.

“We are clearly pleased with our … fiscal 2012 operating performance as we continue to profitably grow our food retail business and our investments and other operations in a very competitive environment,” said family member Paul Sobey, president and chief executive of Empire, in a statement.

In the east, jewellery chain Chow Tai Fook, controlled by the Cheng family, boasted a 61.4% growth in sales for the year ending 31 March – revenues increased to HK$56.57 billion (€5.8 billion).

Profits at the Hong Kong-based family-run group, which is the world’s biggest jeweller by market capitalisation, also jumped by more than 65% to HK$16.45 billion.

Founded in 1938 by Chow Chi Yuen, the business said on 26 June that its performance was due to strong same-store sales growth, expansion in mainland China and increased demand for its jewellery.

Contrastingly, the famous Rothschild banking dynasty has seen a decline in the income of its holding company, Paris Orleans.

On 26 June, the group, chaired by Eric de Rothschild, said net income for the year ending 31 March 2012 fell to €1.14 billion from €1.21 billion the year before.

The fall in income was due to slow growth across the banking group’s global financial advisory and wealth management divisions, the company said.

Profits before tax also dropped sharply to €173.5 million from €315.6 million in fiscal 2011 – a 45% fall. The decline comes just a few weeks after the Rothschild Group announced it will merge some of the shareholdings of the French and English sides of the family into a single entity, which will be listed in Paris.

Times have also been tough for Italian carmaker Fiat, controlled by the Agnelli family. For the month of June, car sales fell in Italy by almost 20%, non-family chief Sergio Marchionne told reporters last weekend.

The slowdown in sale was followed by an announcement by the automobile-maker today that it will increase its stake in US-based Chrysler to 61.8% from 58.5%. The share purchase is expected to be completed over the next few weeks.

Amid news of weak performance among European companies, Belgium’s supermarket chain Colruyt, controlled by the founding family, proved to be a ray of hope. The family business said sales rose by around 8% to €7.85 billion in fiscal 2012.

“The favourable evolution of our market share results from strong sales driven by a sharp focus on the positioning of each activity of the group,” the Halle-based company said in a statement.

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