Dickson Concepts, a Hong Kong luxury goods retailer and owner of department store Harvey Nichols, warned of “the most challenging market conditions” it has ever faced. The comments came on Monday as the company, which licenses upmarket fashion brands such as Tod’s and Roger Vivier as well as jewellery brand Chopard in Asia, reported a 57 per cent rise in net profit to HK$645.8 million (US$83 million) for the financial year ended March 31, according to a filing to the Hong Kong stock exchange. The positive result, an outlier in an industry weighed down by the Covid-19 pandemic, was driven by a successful investment portfolio of listed and private securities, which contributed HK$855.3 million of profit after the disposal of an unlisted investment, the company said. Dickson Concept’s retail division, on the other hand, recorded a loss of HK$209.5 million, as the company “faced the worst local consumer sentiment in its history” in Hong Kong as a result of the virus outbreak, it said. Despite achieving robust sales during the early months of the year, “the retail climate deteriorated significantly thereafter and mainland Chinese tourists all but disappeared,” the company said, referring to the devastating impact of seven months of unprecedented anti-government street protests on Hong Kong’s retail and tourism industries. Sales turnover in Hong Kong plunged by a quarter from the previous financial year, Dickson Concepts said. That is in line with a citywide recession in the industry. Retail sales plunged by 36 per cent year-on-year in April, shrinking for a 15th consecutive month, despite a slight recovery from a record 44 per cent drop in February. Other local retailers have reported brutal losses over the year. Jewellery maker Chow Sang Sang saw net profit plummet by 36 per cent, while rival TSL expects to report an HK$80 million loss, reversing a profit of HK$54 million the year before. The damage from the pandemic is set to deepen, Dickson Concepts warned. Developers’ rental incomes shrink as tenants bail amid economic slump “Our group expects the retail market in Hong Kong to remain extremely depressed for the foreseeable future as we expect local consumer sentiment to be very poor until the economy recovers,” the company said in the filing. “We expect the recovery to pre Covid-19 levels to be an extremely slow and long path. Indeed, this represents the most challenging market condition the group has ever faced.” The retailer, founded and controlled by tycoon Dickson Poon, will adopt a very conservative approach to manage its retail network and continue rigorous cost controls at all levels. With net cash of HK$2.3 billion and a strong balance sheet, the company is in a strong position to withstand the global economic slowdown and a very difficult retail climate ahead, it said. Dickson Concepts operates a network of 61 stores in Hong Kong, mainland China and Taiwan. Hong Kong made up 82 per cent of its income last year, while Taiwan contributed 16 per cent. The company’s shares rose 0.2 per cent to close at HK$4.69 on Monday before the earnings announcement.