TOKYO — Isetan Mitsukoshi Holdings said Friday that its first-half net profit plummeted 91.5 percent due to a high comparative base on tax benefits and extraordinary gains from a year ago.
Japan’s largest department store operator posted a first-half net profit of 1.74 billion yen, or $21.96 million, for the six months ended September 30. thatfigure is down sharply from 20.58 billion yen, or $258.43 million, last year. Dollar figures are calculated based on average exchange rates for each period.
The company’s operating profit fell 9.8 percent to 8.16 billion yen, or $102.85 million, on a combination of higher expenses and the closure of a store in Tokyo, according to a spokesman.
Sales for the fiscal half decreased by 1.5 percent, totaling 574.93 billion yen, or $7.24 billion.
Since May, Isetan Mitsukoshi has been remodeling some sections of its Isetan flagship store in Tokyo’s Shinjuku district. The company partially attributes the drop in sales to the temporary closure of certain parts of the store for renovations.
The company also revised its guidance for the twelve months ending March 31. It is now predicting net profit will fall 64.3 percent to 21 billion yen, or $263.06 million at current exchange rates. This is an even bigger drop than the 50.8 percent fall to 29 billion yen, or $363.28 million, that the company had previously forecast.
Isetan Mitsukoshi left unchanged its operating profit forecast, but adjusted downward its sales guidance. Operating profit is expected to grow 4.9 percent to 25 billion yen, or $313.17 million. The retailer now expects sales to drop 0.5percent to 1.23 trillion yen, or $15.46 billion.