Seven & i, the parent company of convenience retail chain 7-Eleven, has reported a substantial increase in total sales, reaching Y9.28tn ($62.25bn) in the first half (H1) of the fiscal year 2024 (FY24).
This figure encompasses the sales of franchisees under the Seven-Eleven, Seven-Eleven Okinawa, 7-Eleven and 7-Eleven Stores brands.
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For the six months ending 31 August 2024, the company’s revenue from operations surged to Y6.035tn, a significant rise from Y5,547.0bn in the same period of the previous year.
Its operating income for the quarter was Y186.99bn.
Net income attributable to the owners of the parent company was Y52.24bn in H1 FY24 – a decline from Y80.2bn in the same period of the previous year.
The company also announced plans to close more than 400 “underperforming” locations across North America.
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By GlobalDataThese closures – of approximately 3% of its North American stores – are expected to take place in the fourth quarter of FY24.
Seven & i Holdings cites slowing sales, reduced foot traffic and inflationary pressures as reasons for the closures.
The company stated: “The North American economy remained robust overall thanks to the consumption of high-income earners, despite a persistently inflationary, elevated interest rate and deteriorating employment environment. In this context, there was a more prudent approach to consumption, in particular among middle- and low-income earners.
“In this environment, the Seven & i Group aims to be a world-class retail group centred around its food that leads retail innovation through global growth strategies centred on the 7-Eleven business and proactive utilisation of technology.”
“To achieve this goal, the group has been pushing ahead with the business strategies and group strategy laid out in the updated medium-term management plan (announced on 9 March 2023). The group is taking a multi-faceted approach to addressing changes in the consumption environment in Japan and abroad, not only from a medium to long-term perspective but also from a short-term perspective.”
In a move to emphasise its focus on profitable convenience stores, Seven & i also plans to rename itself ‘7-Eleven Corp’, with its attention on its convenience store operations and rebuilding its supermarket business.
It also plans to establish an intermediate holding company for its non-convenience store operations.
The new holding company, to be named York Holdings, will encompass 31 subsidiaries, including the group’s superstores business, general goods store Loft, baby goods store Akachan Honpo, and the operating company of Denny’s restaurants in Japan.
Meanwhile, the company faces investor pressure to demonstrate enhanced value following the rejection of a bid by Alimentation Couche-Tard, operator of Circle K, which Seven & i deemed to have valued the company’s growth potential insufficiently.
In September 2024, Seven & i was designated as “core” to the national security of Japan.
