TOKYO — Isetan Mitsukoshi Holdings said Wednesday that it posted a net loss for its most recent financial year, despite a rise in sales and operating profit. The net loss was due mainly to an extraordinary loss related to restructuring of the company.
For the 12 months ended March 31, Japan’s largest department store operator posted a net loss of 960 million yen ($8.8 million).
Operating profit for the period grew by 2 percent to 24.41 billion yen, while net sales were up by 1.2 percent to 1.27 trillion yen.
Just over a year ago, Isetan Mitsukoshi appointed Toshihiro Sugie to succeed Hiroshi Onishi as chief executive officer of the group. At the time, the company said it intended to implement a “complete change of the management structure.”
The retailer has benefitted from a continued increase in tax free sales to temporary visitors to Japan, and it said in a release that demand for big-ticket items has also remained firm.
“On the other hand, consumption by the middle class remains cautious,” the release said.
The company has been successful at cutting costs and has closed a number of poorly performing stores in recent years, the most recent of which shuttered its doors on March 21. It has also opened a number of new smaller format stores, including its Isetan Salone curated department stores and Isetan Mirror beauty stores.
Isetan Mitsukoshi also released its guidance for its current fiscal year, ending March 31, 2019. It expects to return to the black with a net profit of 13 billion yen.
The retailer predicts its operating profit will increase by 18.8 percent to 29 billion yen.
However, it forecasts its yearly net sales will slip by 5.8 percent to 1.2 trillion yen.