Business / Corporate

Isetan Mitsukoshi logs ¥11 billion annual net loss

Jiji

Major department store operator Isetan Mitsukoshi Holdings Ltd. has reported a consolidated net loss of ¥11.19 billion for the 2019 business year that ended March 31.

The result, coming after turning a ¥13.48 billion profit the previous year, was announced Monday after sales started plunging in February due to a sharp decrease in foreign visitors and voluntary consumer restrictions amid the coronavirus pandemic.

Isetan Mitsukoshi stores have been shut across the country since April, when the government declared a state of emergency over the COVID-19 crisis.

The company skipped an announcement of its earnings projections for the current year through March 2021 because it is not sure when it can reopen its stores. Its store closures are forecast to push down profits by ¥15 billion per month.

Consolidated sales for the 2019 business year fell 6.5 percent from 2018 to ¥1.12 trillion. Operating profit tumbled 46.4 percent to ¥15.68 billion.

“Even if we resume store operations, sluggish consumption will continue because voluntary restrictions on going out will remain and foreign visitors are unlikely to return soon,” President and Chief Executive Officer Toshihiko Sugie told a telephone news conference Monday.

“We can’t avoid scaling down and cutting stores in the long run,” Sugie said, while noting there are no immediate plans to do this.

He said his company will seek to strengthen its real estate and e-commerce business.

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