Tokyo, April 9 - Japan's largest retailer, Seven & I Holdings, forecast on Thursday a 1.1 percent rise in operating profit for the current year after its profits held steady in the year that ended in February as solid growth in its convenience store business offset a slump in retail sales.
Japanese retail sales have slumped as the economy slid deeper into recession, with department stores among the hardest hit as consumers slash spending on clothing and look for bargains.
But the impact of the retail industry slump was cushioned for Seven & I by its 12,000 Seven-Eleven convenience stores in Japan, which attracted growing numbers of thrifty shoppers who are spending more time at home.
For the year to next February, the company predicted an operating profit of 285 billion yen ($2.86 billion). That was largely in line with a mean forecast of 288.5 billion yen in a poll of 11 analysts by Reuters Estimates.
Seven & I, which operates Ito-Yokado supermarkets and Sogo and Seibu department stores, said its operating profit came to 281.9 billion yen for the year that ended in February, almost unchanged from 281.1 billion yen a year earlier.
Seven & I said last month that it expected its operating profit for the year that ended in February to be largely unchanged from the year before.
Seven-Eleven and rival convenience stores were also helped by a windfall in tobacco sales following a law change that required smokers to get special ID cards to buy cigarettes at vending machines. Smokers who couldn't be bothered with the new cards migrated to convenience stores.
Shares of Seven & I have fallen 20 percent in the past 12 months, outperforming a 33 percent decline in the benchmark Nikkei average.
Its shares closed up 1.8 percent at 2,310 yen ahead of the announcement, underperforming a 3.7 percent rise in the Nikkei average.