Seiyu Ltd. said Tuesday it widened its forecast loss for the full year due to costs to cut jobs, its second downgrade in five weeks.
The net loss is likely to be ¥10.4 billion in the year ending Dec. 31, the company said in a statement to the Tokyo Stock Exchange. That compares with a ¥5.9 billion loss forecast on Aug. 14 and a loss of ¥55.8 billion last year.
The Tokyo-based retailer, the Japan unit of Wal-Mart Stores Inc., will take a charge of ¥4.5 billion to cut 450 positions filled by workers aged 44 to 59. The staff reduction is part of efforts to increase efficiency, particularly head office functions, the retailer said.
Wal-Mart is attempting to turn around Seiyu's performance in a grocery market that has suffered 19 straight monthly declines in sales as higher taxes and falling wages curb spending. Seiyu is increasing the number of 24-hour stores and renovating outlets to attract customers in the shrinking market.
Seiyu maintained its forecast that annual sales will rise just 0.2 percent to ¥963 billion.
The retailer, which has about 400 stores selling food, clothing and general merchandise, has posted annual losses since 2003 when it began providing data for the fiscal year ending Dec. 31.
Wal-Mart, the world's largest retailer, holds 51 percent of Seiyu, and has an option to raise its stake to 66.7 percent by the end of this year. The company first invested in Seiyu in 2002.
Seiyu Chief Executive Officer Edward James Kolodzieski has said Wal-Mart is committed to Japan after the retailer withdrew from South Korea and Germany last year.