Cafe de Coral has reported lower sales and a double-digit decrease in profit for the last fiscal year, with management citing a weak economy and consumer sentiment.

The group’s revenue for the year ended March 31 slid 1.4 per cent to HK$8.568 billion (US$1 billion) and attributable profit dipped 29.6 per cent to HK$232.7 million.

Management said the restaurant sector in Hong Kong and Mainland China faced a severe downturn during the year, marked by a weak economy and consumer sentiment.

Other major headwinds included outbound spending behaviour of Hong Kong residents and fierce price competition in the Mainland China market.

In Hong Kong revenue decreased 1.4 per cent, with casual dining down 6.4 per cent and quick service restaurants down 0.3 per cent. Mainland China revenue fell 1.3 per cent.

“The uncertainty we have witnessed over the past year is a sign of a longer-term transformation in markets worldwide, as geopolitical forces settle into a new dynamic,” said Cafe de Coral chairman Sunny Lo.

“Our management team has accepted and embraced the current economic challenges, and is adapting the business to thrive in the new environment…

“We are updating our restaurant portfolio, recruiting fresh talent, and adopting new technology to transform the business for the future,” he continued.

Cafe de Coral operates a network of over 500 stores in Hong Kong, Macau and nine key cities in Mainland China.