TOKYO — Japan’s largest department store operator, Isetan Mitsukoshi Holdings Co. Ltd., issued another profit warning for the year ending March 31 amidst a protracted slump in consumer spending.
This story first appeared in the February 6, 2009 issue of WWD. Subscribe Today.
The company now sees its full-year net profits coming in at 11 billion yen, or $122.9 million at average exchange, more than 59 percent lower than its most recent projection last fall. Sales are coming in at 1.4 trillion yen, or $15.87 billion, down 5 percent from the earlier forecast.
“Personal consumption declined [in the third quarter] as the economic climate became worse. This trend will continue for a while,” the company said.
Net profit for the nine months ended Dec. 31 was 15.8 billion yen, or $153.2 million. Sales were 1.1 trillion yen, or $10.7 billion. Isetan Co. and Mitsukoshi Ltd. merged earlier last year, thus no comparative figures were released.
The company is liquidating stores and subsidiaries to respond to deteriorating market conditions in Japan and abroad. As reported, it will close six Mitsukoshi stores in Japan in the spring, including a flagship in Tokyo’s Ikebukuro neighborhood, which generates annual sales of about 24.2 billion yen, or $270.4 million. In December, the retailer shuttered its flagship in Shanghai, and later this year it will close its stores in Germany.