Luxury jeweller King Fook says it lost $149.25 million in the year to March 31, blaming the Occupy Central protest movement and the decline in cashed up Mainland shoppers.

The group’s turnover from its retail business plunged 27.8 per cent to $817.6 million (from $1.13 billion the previous year) “following the general decline of the Hong Kong luxury goods retail market”.

As the company discounted stock to increase sales, its gross profit margin fell from 23.7 per cent to 20.9 per cent.

It closed or downsized five underperforming stores to consolidate its floor space.

In its filing, King Fook said the spending of tourists from Mainland China was adversely affected by the Chinese Government’s anti extravagance campaign, which in turn seriously affected the luxury goods retail market.

“Moreover, local consumption sentiment was negatively impacted by the outbreak of the Occupy Central protests during the period from September to December 2014.

“The Hong Kong luxury goods retail market has not recovered since the outbreak of Occupy Central and has further deteriorated by weakened consumption patterns and deceased spending of tourists from Mainland China. The group expects the sluggish market conditions will continue and the challenge to the luxury goods retail market is severe.”

It says it will “enhance its competitiveness by cautiously reviewing and adjusting its store locations, operating costs and product mix so as to better address the changing tourists’ needs and the local market”.

The company expects rent reductions in the year ahead reflecting the slowdown of the luxury goods retail market.

It will also develop an online platform so as not to miss out on the trend towards online shopping. It hopes an online presence will direct internet users to visit the group’s physical stores.