US retail giant Wal-Mart has said it remains confident it can turn around its struggling affiliate Seiyu, despite the Japanese chain posting first-half losses on Tuesday.
Seiyu, Japan’s fourth-largest retailer, reported a group net loss of ¥8.43bn (US$76.7m) for the six-month period, compared to a year-earlier net loss of ¥22.39bn. The year-ago result included almost ¥35bn in special charges related to a group reorganisation and stock losses.
In an interview with the Financial Times, Wal-Mart’s chief operating officer, Jeff McAllister, denied Seiyu was in worse shape than Wal-Mart had expected.
“We were very aware of the good, the bad and the ugly in terms of (Seiyu’s) history,” he was quoted by the newspaper as saying.
“I’m optimistic about the plans we’ve got set, both for next year and the year that follows. We are seeing good customer feedback with the introduction of the new (product) lines we’re bringing in. Our focus is to build sales and to build bottom line profits for Seiyu. We’re confident about the plans we have in place,” McAllister said.
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By GlobalDataWal-Mart holds a 37.8% stake in Seiyu and has an option to raise its stake to 66.7% until the end of 2007.
