Seven & I Holdings forecast operating profit and revenue for the current year that missed analyst estimates, adding to pressure on the company to find new avenues for growth after divesting stakes in its supermarket and banking units.
Operating profit will rise 0.7% to ?424 billion ($2.9 billion) for the 12 months ending February 2026, falling short of the average analyst forecast of ?459.6 billion. During the same period, it expects sales to come in at ?10.76 trillion, a 10% fall from a year earlier. That compares with the ?11.61 trillion estimated by analysts.
Seven & I said it expects domestic convenience store sales to rise 9.4% this fiscal year, while seeing revenue from overseas convenience stores falling 3.6%.
While the Japanese economy¡¯s gradual recovery is seen boosting wages, investments and tourism demand, growing uncertainty over trade policy remains a key risk to the outlook, the retailer said in a statement Wednesday.
The guidance miss adds to the pressure on the retailer¡¯s new leader Stephen Dacus, who took the helm of the Japanese company last month as part of broader restructuring measures. The operator of 7-Eleven stores has taken other steps to unlock shareholder value since becoming the target of a takeover bid by Canadian retailer Alimentation Couche-Tard.
Besides tapping Dacus for the leadership role, making him its first foreign leader, Seven & I last month sold the underperforming superstore business and announced plans for a share buyback, alongside divesting the Seven Bank.
The company Wednesday announced it will purchase ?600 billion worth of shares through February, as part of the ?2 trillion buyback plan it announced last month.
Seven & I¡¯s stock is still reflecting some uncertainty given minimal progress on Couche-Tard¡¯s offer, especially after a management buyout effort led by the founding Ito family failed. The retailer¡¯s market valuation is hovering around ?4.8 trillion, significantly lower than Couche-Tard¡¯s offer of ?7.39 trillion.
Seven & I and Couche-Tard have agreed to seek a third-party buyer for overlapping retail outlets as a prerequisite for takeover talks. The process, initiated by the Japanese retailer, is aimed at making sure that any deal won¡¯t fall apart because of U.S. antitrust concerns.
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