JAPAN: Daiei predicts 30% profit plunge
Japanese supermarket group Daiei said today (17 May) that it anticipates a 30% fall in profits next year.
Japan's third-largest retailer said that it expects to post profits of JPY22bn (US$181.64m)for fiscal 2008/9, down from JPY31bn this year.
The group primarily attributed the fall in profits to its planned sale of a 31.8% stake in its credit card unit, OMC Card. This, the company said, will result in a smaller contribution from its financial division. Daiei currently holds 52% of OMC. Proceeds from the sale will be used to reduce interest-bearing debt.
Daiei also said that it anticipates higher costs, as it plans to increase investments in new store openings and the refurbishment of existing stores.
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