Starbucks Coffee Japan Ltd. said Wednesday its net profit for the first half dropped 54.9 percent year-on-year to 220 million yen, battered by the declining popularity of its coffee shops.

It also cut its outlook for the full year to March, predicting a net loss of 500 million yen, against the net profit of 735 million yen logged in last year.

The coffee shop chain does not have any subsidiaries.

The operating profit for the six months through September fell 31.5 percent from a year ago to 642 million yen, while group sales were down 21.5 percent to 27.49 billion yen.

Starbucks officials cited a sharp drop in sales, falling 14 percent year-on-year for those shops open at least one year.

It was a rude wakeup call for the chain, which has been aggressively opening new outlets since its first in Tokyo's Ginza district in August 1996. The number of outlets stood at 398 at the end of September.

On Nov. 6, the chain closed an unprofitable store in Sendai -- the first to fold.

"I think complex factors were behind (the drop in sales)," CEO Yuji Tsunoda said. "It's not simply because of competitors or our outlets cannibalizing each other."

The chain earlier said it would cut the number of new shop openings for this business year from the initially planned 120 to 115, with up to 10 outlets to be closed through the next year.

Shares of Starbucks, listed on the Nasdaq Japan Market, have been on a steady decline, closing at 10,000 yen in Wednesday's session, 88 percent down from its peak of 84,300 yen recorded one year ago.