The fast-food chain blames Sars, the economic slowdown and high unemployment for the 12.4pc drop Cafe de Coral Holdings has posted is first profit decline since 1997, with earnings falling 12.4 per cent last year. For the year to March 31, Cafe de Coral's net profit fell to $245.27 million, from $280 million previously. Its performance was below Thomson Financial's consensus estimate of $269 million. A $20 million provision was made, including $12.17 million for the declining value of its stake in a Chinese fast food chain, which analysts believe is rival Fairwood Holdings. Shares of Fairwood have slumped 42 per cent over the past 12 months. A $7.69 million provision was also made for a deficit on revaluating investment properties. Chairman Michael Chan Yue-kwong said average spending per meal at the Cafe de Coral fast-food chain had fallen to $23.30 from $25 amid a deflationary environment and high unemployment rate. Its 120-outlet chain in Hong Kong accounted for about 70 per cent of the total profit, Mr Chan said. 'The outbreak of Sars in Hong Kong and other parts of world in March further deepened the adversity in the operating environment,' he said. To strengthen its revenue, Mr Chan said the group's main task in the future would be to focus on turning around its loss making overseas operations and the recently acquired Oliver's Super Sandwiches chain. The group is the world's largest Chinese fast-food chain with 544 outlets worldwide. Despite the profit decline, the company proposed a final dividend of 18 cents, bringing the total dividend to 24.4 cents. Mr Chan said the group's sales last month had bounced back to pre-Sars levels following a dramatic fall of up to 70 per cent at the peak of the virus outbreak. The group planned to open 20 new Cafe de Coral outlets in Hong Kong and five in southern China this year at a capital expenditure of less than $100 million, he said. Cafe de Coral shares finished unchanged at $6 yesterday.