Seven & I Holdings Co. said its profit fell 28 percent in the three months that ended in May on slumping supermarket and department-store sales.
Net income fell to ¥23.7 billion from ¥33.1 billion, the nation's largest retailer said Thursday. Sales fell 11 percent to ¥1.24 trillion from ¥1.39 trillion.
Chief Executive Officer Toshifumi Suzuki is struggling to boost sales amid rising unemployment and falling wages. Seven & I, which operates Seven-Eleven convenience stores and Ito-Yokado supermarkets and department stores, is expanding its own brands for products such as bottled tea and soy sauce because they're cheaper while providing wider profit margins.
The company forecast net income to rise 33 percent to ¥123 billion in the business year ending next February. Operating profit is supposed to gain 1.1 percent to ¥285 billion on lower costs at supermarkets and higher sales at its banking division. Sales are projected to fall 6 percent to ¥5.31 trillion.
Seven-Eleven Japan's costs will increase by as much as ¥5 billion in the current business year after the company said it will pay 15 percent of costs incurred by Japanese franchisees when they discard expired food. The Fair Trade Commission had told the company to allow store operators to offer discounts on boxed meals near their expiry.