By Taihei Ishikawa
Yomiuri Shimbun Staff Writer
Seven & i Holdings Co.'s core domestic convenience store business is stagnating as prices are rising, although the group logged a 9.7% year-on-year increase in operating profit to 65 billion yen in its consolidated financial results for the March-May period. The restructuring of its group business to focus on convenience stores is still in progress.
According to the financial results for the first quarter of the fiscal year ending February 2026, announced Thursday, the group's revenues from operations rose 1.6% to 2.77 trillion yen. Its net profit saw a 2.3-fold increase to 49 billion yen due to such factors as the recording of asset sale gains generated from the closure of Ito-Yokado Co. stores.
Since receiving an acquisition proposal from Alimentation Couche-Tard Inc., a major Canadian convenience store operator, Seven & i has been pursuing a strategy of independent management to enhance corporate value. The company intends to concentrate its management resources on its convenience store operations in Japan and the United States by selling York Holdings Co., which operates Ito-Yokado and other non-convenience store businesses, to a U.S. investment fund.
However, the current business environment remains challenging due to rising prices. In the March-May period, operating profit for Seven & i's core domestic convenience store business fell by 11%. Though the company took steps to eliminate the image of the chain's products as expensive, these efforts came too late, and the number of customers decreased by 0.7%.
Tomohiro Akutsu, who became president of Seven-Eleven Japan Co. in May, said during a press conference on Thursday: "It has been a very difficult start. We will set aside our past successes and take on new challenges." The company plans to make a turnaround by introducing new products, such as fresh baked goods and tea prepared in-store.
Operating profit for the group's U.S. convenience store business, another pillar of its operations, increased 21.7%, its first rise in five quarters. The business had been in a difficult situation as more middle- and low-income consumers limited their purchases amid rising prices. But in the March-May period, expanded product lineups and cost reduction efforts contributed to a positive result.
In contrast, other major convenience store chains in Japan are seeing solid results. FamilyMart Co. reported that its net profit for the March-May period this year hit a record high for the quarter as it announced its consolidated financial results for the quarter on Wednesday. Lawson Inc. said it saw about a 4% increase year on year in its existing store sales from March to May.
Yoshimichi Maruyama, chief financial officer of Seven & i, said at a press conference Thursday that the company would unveil a new mid-term business plan in August. It would be the first mid-term plan under the new management team led by President and CEO Stephen Hayes Dacus, and the question of how the company will outline its growth strategy moving forward will be a key focus of attention.
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This article is from The Yomiuri Shimbun. Neither Dow Jones Newswires, MarketWatch, Barron's nor The Wall Street Journal were involved in the creation of this content.
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July 13, 2025 22:10 ET (02:10 GMT)
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