Luxury goods group Richemont struck a cautious note after reporting sales numbers hurt by moves to combat the grey market and efforts by the Chinese government to discourage consumers from spending overseas.

The company known for Cartier jewellery and IWC watches attributed a weak performance in Europe in the six months to Sept. 30 to the disposal of its Lancel bag business and a drop in watch sales to third-party retailers to avoid unsold stock ending up on online platforms at big discounts.

“We are clamping down on grey market activities in the watch trade,” finance chief Burkhart Grund told reporters on Friday. “Is the worst over? Well, I hope so. The market will tell us.”

Richemont shares, which have lost more than 16 percent of their value this year, were down 6 percent at 1033 GMT, against a 3.8 percent fall for rival Swatch Group.

Sales growth has slowed for Swiss luxury watchmakers of late, with exports to their biggest markets, Hong Kong and the United States, turning negative in September.

Grund said that Asia-Pacific sales had dipped in September because of factors including bad weather and a weakening of the renminbi currency that affected regional tourism, but group sales had bounced back in October to first-half levels.

Richemont had already reported five-month sales in September, so investors’ focus on Friday was mostly on September and October trading and any comments about a possible slowdown in Chinese spending amid its trade war with the United States.

Rival luxury groups Hermes and Kering had already reported solid sales growth and played down fears of cooling demand in China.

Richemont, the world’s second-biggest luxury group, has recently made adjustments to its portfolio to gear it more towards the online sector and last month announced a strategic partnership with Chinese e-commerce giant Alibaba.

Group sales grew 8 percent at constant currency in the six months to Sept. 30, down from 10 percent during the five-month period. Including the contribution of recently acquired online distributors Yoox Net-a-Porter (YNAP) and Watchfinder, first-half sales were up 24 percent. While sales in Asia Pacific, its biggest market, held up with high single-digit sales growth in mainland China and double-digit increases in Hong Kong, Macau and Korea, European sales rose by only 1 percent.

Profit more than doubled to 2.25 billion euros ($2.55 billion) in the first half, helped by a 1.38 billion euro non-cash gain related to Yoox Net-a-Porter.

Excluding the one-off gain, net profit fell 10 percent to 875 million euros, hit by acquisition and disposal-related charges.