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Japan-Update

Aeon Mall seen hitting seventh straight pretax profit record

New shopping centers in Japan, abroad give sales a lift

TOKYO -- Aeon Mall's group pretax profit likely grew 10% to around 46 billion yen ($415 million) for the year ended in February, beating a company forecast by about 1 billion yen thanks to narrower overseas losses.

Operating revenue likely grew 20% to roughly 270 billion yen, helped by new shopping centers. The Chiba-based company opened two overseas and six in Japan, including one in Aichi Prefecture in December. Aeon Mall's acquisition of Opa, a Japanese fashion mall operator, also helped lift revenue.

But the pretax profit gain owes much to a smaller loss in the company's overseas business, which accounts for about a tenth of overall operating revenue. Tenant revenue climbed at shopping centers in countries such as China, Vietnam and Cambodia. Foreign operations stabilized following a rapid expansion in the store count in the preceding fiscal year, and labor costs fell.

In Japan, operating profit dipped slightly as two malls suspended operations due to earthquakes in Kumamoto Prefecture last April. Specialty stores sales at existing malls, excluding those two locations, were apparently little changed from a year earlier.

For the year ending February 2018, the company is expected to see continued improvement in its overseas business. Group operating revenue will likely grow 10% over the estimated fiscal 2016 result to around 290 billion yen, while operating profit is expected to rise 10% to about 50 billion yen. The annual dividend is seen climbing from the 27 yen per share forecast for fiscal 2016.

(Nikkei)

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