Fashion retailer FJ Benjamin Holdings' first quarter net profit slumped to $396,000 from $2.3 million.
Turnover for the three months to Sept 30 rose by 2 per cent to $96 million.
FJ said in a statement that it operated in a highly competitive retail and distribution environment in which retailers actively engaged in markdown pricing to clear inventory.
Gross margins declined by 1 percentage point to 42 per cent.
The results included a fair value loss on investment securities of $600,000 and an exchange loss of $800,000.
Operating expenses stood at $39.3 million with cost-to-revenue ratio at 40.9 per cent compared to 41.5 per cent in the same period last year.
Group turnover from the fashion business rose 8 per cent to $68.6 million but the timepiece business decreased by 11 per cent to $27.1 million.
In Southeast Asia, the fashion business increased by 6 per cent and the timepiece business by 17 per cent.
This was partly due to increased shipments to Indonesia for both fashion and timepieces.
In North Asia, the timepiece business in Hong Kong fell 26 per cent while in China, it dived 47 per cent.
The ongoing slowdown in demand for luxury timepieces in China and reduced tourist spending by mainland Chinese visitors in Hong Kong were main factors behind the lower sales.
Indonesia continued to see growth with domestic sales rising by 5 per cent despite the currency turmoil during the quarter.
Earnings per share fell to 0.07 cent from 0.41 cent previously while net asset value per share slipped to 22.7 cents compared to 23.09 cents as at June 30.