TOKYO -- Retail giant Aeon logged a net loss of 6.2 billion yen ($61.2 million) for the first quarter ended May 31 as budget-conscious shoppers looked elsewhere for clothing and household goods.
The result, announced Wednesday, marked the first red ink for this three-month period in seven years. Aeon had posted a 5 billion yen profit a year earlier.
Operating revenue, the equivalent of sales, rose 1% to 2.04 trillion yen. Operating profit slid 6% to 32.8 billion yen.
The segment handling general merchandise stores struggled. Aeon was "late" to release low-priced products, Vice President Soichi Okazaki said, noting that it "was unable to fully capture increasingly price-sensitive consumers" while endeavoring to develop quality offerings.
Sales in the business increased more than 10%. But costs for store openings and conversions of former Daiei locations weighed heavily, and the segment incurred an operating loss of 9.3 billion yen. Same-store sales sank 2% at unit Aeon Retail.
On the other hand, the supermarket business boosted profit after bolstering lineups of local items. The drugstore business posted growth as well.
Aeon logged an extraordinary loss of 1.9 billion yen, mainly for temporary store closings in the wake of the Kumamoto-area earthquakes.
But the quarter's earnings were roughly in line with plans, the company said, maintaining its forecast of net profit climbing 66% to 10 billion yen for the full year ending February 2017.