Multibrand fashion retailer I.T Limited saw a double-digit decline in full-year earnings as sales slipped in its home market of Hong Kong on slower tourist flows.

The company said Wednesday that its net profit for the 12 months ended Feb. 29 decreased 33 percent to 209.7 million Hong Kong dollars, or $27 million. The company said markdowns forced operating profit to slide 14.7 percent to 421.3 million Hong Kong dollars, or $54.24 million.

Retail sales for the year grew 5 percent to 7.54 billion Hong Kong dollars, or $970.65 million. New store openings in mainland China boosted sales there, which compensated for a drop in business in Hong Kong, I.T said.

Sales in mainland China increased 16.4 percent to 2.98 billion Hong Kong dollars, or $383.63 million, as I.T’s sales floor area grew by 16.8 percent. Same-store sales grew 3.9 percent, the company said.

“Sales development in mainland China was also discouraged by restrained economic growth and a shift in the shopping patterns of consumers toward overseas markets,” I.T said.

Sales in Hong Kong fell 3.3 percent to 3.46 billion Hong Kong dollars, or $445.42 million. The company said it reduced its total sales floor space in Hong Kong by 5.2 percent over the same time period.

“The persistent uncertainty around the state of the global economy, along with the headwinds from Hong Kong Dollar appreciation that discouraged in-bound tourist flows and a broad-based deflationary environment around the different regions of operation have placed excessive downward pressure on the already dampened consumer discretionary market in Hong Kong,” the company said.

Other luxury-goods companies with a heavy exposure to Hong Kong are also suffering in the current environment. Chow Tai Fook issued a profit warning earlier this month. Hong Kong’s retail sales slumped 9.8 percent in March and 13.6 percent in January and February combined.

I.T, which owns Japanese streetwear brand A Bathing Ape, warned that trading conditions remain challenging in Asia, especially Hong Kong.

“We do not expect consumer spending momentum to witness any form of imminent improvement given the limited indication of a turnaround of the global economic landscape and retail sector in the near term,” said the company. “Therefore, 2016 appears challenging and is set to be affected by instability in tourist spending flows as well as macroeconomic and promotional headwinds.”

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