Retail giant Aeon logged a net loss of 6.2 billion yen ($61.2 million) for the first quarter ended May 31 as budget-conscious shoppers looked elsewhere for clothing and household goods.
The result, announced Wednesday, marked the first red ink for this three-month period in seven years. Aeon had posted a 5 billion yen profit a year earlier.
Operating revenue, the equivalent of sales, rose one percent to 2.04 trillion yen. Operating profit slid six percent to 32.8 billion yen.
Aeon was “late” to release low-priced products, Vice President Soichi Okazaki said, noting that it “was unable to fully capture increasingly price-sensitive consumers” while endeavoring to develop quality offerings.
Sales in the business increased more than 10%, but costs for store openings and conversions of former Daiei locations weighed heavily, and the segment incurred an operating loss of 9.3 billion yen. Same-store sales sank two percent at unit Aeon Retail.
On the other hand, the supermarket business boosted profit after bolstering lineups of local items, and the drugstore business posted growth as well.
(Source: Nikkei Asian Review)