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UPDATE 1-Seven & i Q3 profit gains on strong convenience store food sales
January 12, 2017 / 6:47 AM / a year ago

UPDATE 1-Seven & i Q3 profit gains on strong convenience store food sales

* Company sticks with record operating profit forecast

* Retailer boosting food offerings to lure consumers

* Expanding convenience store business (Adds detail)

TOKYO, Jan 12 (Reuters) - Seven & i Holdings Co on Thursday posted a third-quarter operating profit gain helped by robust food sales in its convenience store chain, putting Japan’s second biggest retailer on course for a record annual profit.

Operating profit for the three months ended Nov. 30 rose 4.4 percent to 92.5 billion yen ($808.50 million), versus a profit of 88.6 billion yen a year earlier, calculations based on the retailer’s nine-month results show.

Three analysts expected the retailer to post an operating profit of 85.6 billion yen, Thomson Reuters data shows.

The retailer stuck with its operating profit forecast for the year ending Feb. 28 of 353 billion yen, lagging an average estimate of 355.2 billion yen by 16 analysts surveyed by Thomson Reuters.

Seven & i has previously said that it was aiming to boost its annual operating profit to 450 billion yen by the business year ending Feb. 28, 2021.

To make that possible as retail demand remains tepid amid a persistent economic malaise, the retailer is expanding food offerings such as frozen meals, and offering higher quality snacks and other food under its own brand.

While shuttering 40 general merchandising outlets and expanding its Seven Eleven convenience store business, it also plans to map buyers’ shopping habits through loyalty cards and tailor its offerings accordingly.

Two decades of a struggling economy have slashed consumer demand in Japan. The country’s core consumer prices marked a ninth straight month of annual declines and household spending slumped in November, suggesting slow wage growth was keeping people from shopping.

$1 = 114.4100 yen Reporting by Tim Kelly; Editing by Himani Sarkar and Joseph Radford

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