Japanese retailer Daiei has booked a drop in first-quarter earnings as soaring raw material prices, competition and low consumer sentiment hit profits.

In the three months to the end of February, net profit fell to JPY1.34bn (US$13.4m) from JPY2.24bn a year earlier. Operating profit dropped to JPY811m from JPY1.45bn last year, the retailer reported today (5 July).

While on a “moderate recovery trend”, Daiei said it had experienced “soaring” import fuel and raw material prices, intense competition and low consumer confidence due to reduced disposable incomes in the quarter.

Sales, however, climbed 5.9% in the period to reach JPY193.39bn.

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