Jun 5, 2009
Japan's Aeon likely to miss China store target
Jun 5, 2009
TOKYO, June 5 (Reuters) - Japanese retailer Aeon Co Ltd (8267.T) said it is likely to miss its target of opening another 70 supermarkets in China by the end of February 2011 due to local delays in developing new stores.
Aeon Co Ltd sales room
Aeon has been looking to expand in China while curbing outlet openings at home, where it faces slow growth prospects and fierce competition. It currently has 28 stores in China.
The company, which also operates the Jusco store chain, said it had no plan to curb investment in China, denying a Nikkei business daily report that it was spending less there due to the country's economic slowdown.
The Chinese economy registered its weakest quarter on record with growth of 6.1 percent in January-March from the same period the year before.
"It's true that we are not seeing double-digit growth there now, but it remains one of the fastest growing economies," said Aeon spokesman Koji Tsusue. "We have no intention of curbing store openings there."
But he said the retailer is not likely to open stores as quickly as it had planned because of factors "beyond our control," such as delays in construction projects due to some developers lacking funds.
The company has said it aims to have 100 stores in China by the end of February 2011.
The firm posted its first net loss in seven years for the year that ended in February, hit by weak sales at home and a slump at its U.S. apparel chain Talbots (TLB.N).
But the retailer said sales and profits at its Chinese operations rose during the period, with its local currency operating profit logging double-digit percentage growth. (Reporting by Taiga Uranaka, Ashutosh Joshi; Editing by Joseph Radford)
© Thomson Reuters 2023 All rights reserved.