Business Structure Reform and Closure of Unprofitable Stores at Sogo & Seibu

「Loss related to the transfer of the department store business　132,241」

「Following satisfaction of the prescribed conditions set out in the transfer agreement and this memorandum, we completed the share transfer on 1 September 2023.」

「Regarding the department store business operated by そごう・西武, we concluded that it would be difficult to maximize the value provided to customers and the value of the business through business restructuring using the management resources of our group. We therefore considered seeking a best owner to improve the company's growth and efficiency.」

「At the department stores, same-store sales exceeded the previous year, mainly because apparel sales recovered following the previous year's shortened operating hours and restrictions on the number of customers entering stores, while luxury-brand sales also performed well. At the restaurants, same-store sales also exceeded the previous year, owing to the rebound from the previous year's shortened operating hours and restrictions on serving alcoholic beverages, as well as the recovery in demand for dining out.」

「At the department stores, same-store sales exceeded the previous year, mainly because apparel sales, a core category, recovered following the previous year's shortened operating hours and restrictions on the number of customers entering stores, while luxury-brand sales also performed well. At the restaurants, same-store sales also exceeded the previous year, owing to the rebound from the previous year's shortened operating hours and restrictions on serving alcoholic beverages, as well as the recovery in demand for dining out.」

「As a result, the operating loss of the department store and specialty store business decreased by ¥9,291 million from the previous fiscal year to ¥8,153 million.」

「As a result, the operating loss of the department store and specialty store business decreased by ¥4,553 million from the corresponding period of the previous year to ¥10,217 million.」

「However, due to the rebound from people refraining from going out in response to COVID-19 the previous year, the operating loss of the department store and specialty store business decreased by ¥2,743 million from the corresponding period of the previous year to ¥7,771 million.」

「Like 株式会社イトーヨーカ堂, 株式会社そごう・西武 continued to pursue business and store restructuring and closed 5 underperforming stores during the period to concentrate management resources in the Tokyo metropolitan area. During the fiscal year, the spread of COVID-19 significantly affected customer traffic and other factors, resulting in same-store sales falling below the previous year. Operating profit was affected by shortened operating hours, temporary closures and other measures to contain the spread of COVID-19, resulting in a loss of ¥6,691 million, down ¥7,045 million from the previous fiscal year.」

「The operating loss was limited to ¥7,073 million, an increase of ¥4,455 million from the corresponding period of the previous year, partly because costs related to COVID-19 measures were transferred to extraordinary losses.」

「Like Ito-Yokado, そごう・西武 continued to pursue business and store restructuring, and closed 4 underperforming stores on 31 August to concentrate management resources in the Tokyo metropolitan area.」

「Like Ito-Yokado, そごう・西武 continued to pursue business and store restructuring. In the first quarter, however, it shortened operating hours at all stores and operated only the food sections, among other measures, to help contain the spread of COVID-19, resulting in same-store sales falling below the previous year. The operating loss was limited to ¥1,241 million, an increase of ¥870 million from the previous first quarter, partly because costs related to COVID-19 measures were transferred to extraordinary losses.」

「株式会社そごう・西武 is pursuing selection and concentration based on its medium-term management plan announced in October 2016 and its business restructuring announced in October 2019, and plans to close 5 stores during the fiscal year ending February 2021.」

「Like Ito-Yokado, 株式会社そごう・西武 had implemented store restructuring involving closures and store transfers under its “100-day plan.” In October, however, it announced business restructuring comprising store policy, personnel policy and sales-floor policy, in order to further pursue selection and concentration and enhance its value as a commercial facility. In November, as part of this initiative, it renovated Seibu Tokorozawa store with the aim of integrating a department store and specialty stores to establish a new operating model for suburban stores. However, same-store sales for the nine months ended the third quarter fell below the previous year, and the operating loss increased by ¥1,680 million from the corresponding period of the previous year to ¥2,617 million.」

「株式会社そごう・西武 pursued a strategy of concentrating management resources on large stores in the Tokyo metropolitan area as part of its business restructuring, while beginning renovations at Seibu Tokorozawa store with the aim of integrating a department store and specialty stores as a new operating model for suburban stores. However, same-store sales for the six months ended the second quarter fell below the previous year, and the operating loss increased by ¥785 million from the corresponding period of the previous year to ¥1,078 million.」

「株式会社そごう・西武 pursued a strategy of concentrating management resources on large stores in the Tokyo metropolitan area as part of its business restructuring, while beginning renovations at Seibu Tokorozawa store to create a low-cost operation through conversion to a tenant-based model. However, same-store sales in the first quarter fell below the previous year, and the operating result was a loss of ¥371 million, down ¥662 million from the previous first quarter.」

「Same-store sales during the fiscal year fell below the previous year, while operating profit was ¥3,266 million, or 64.3% of the level in the previous fiscal year.」

「Sogo & Seibu Co., Ltd. advanced a strategy of concentrating management resources on large stores in the Tokyo metropolitan area as part of its business structural reforms, including renovating the beauty segment sales floor at Sogo Yokohama, where cosmetics and related products are strengths. However, same-store sales during the nine-month period ended November 2018 fell below the previous year, and the operating loss increased by ¥794 million from the nine-month period ended November 2017 to ¥937 million.」

「Sogo & Seibu Co., Ltd. advanced a strategy of concentrating management resources on large stores in the Tokyo metropolitan area as part of its business structural reforms, including renovating the beauty segment sales floor at Sogo Yokohama, where cosmetics and related products are strengths. However, same-store sales during the six-month period ended August 2018 fell below the previous year, and operating profit was a loss of ¥292 million, down ¥919 million from the six-month period ended August 2017.」

「Sogo & Seibu Co., Ltd. advanced a strategy of concentrating management resources on large stores in the Tokyo metropolitan area as part of its business structural reforms, including beginning a sales-floor renovation in the beauty segment at Sogo Yokohama, where cosmetics and related products are strengths.」

「On 1 October 2017, the company transferred the Sogo Kobe and Seibu Takatsuki businesses to H2O Retailing Co., Ltd., and Seibu Funabashi and Seibu Odawara closed on 28 February 2018.」

「Sogo & Seibu Co., Ltd. operated 17 stores as of the end of November 2017, down 2 from the end of the previous fiscal year. Under the final agreement concerning the transfer of the Sogo Kobe and Seibu Takatsuki businesses concluded with H2O Retailing Co., Ltd. in August 2017, the business transfers were completed on 1 October of that year.」

「The business environment surrounding the company remained challenging. Judging that further structural reforms were necessary under the business structural reforms announced on 8 March 2016, the company announced on 25 August 2017 that Seibu Funabashi and Seibu Odawara would close as of 28 February 2018.」

「Sogo & Seibu Co., Ltd. operated 19 stores as of the end of the fiscal year, down 4 from the end of the previous fiscal year. In sales operations, it strengthened high-quality customer service unique to department stores and comprehensive advisory services provided by specialized sales staff, including beauty advisers. Under its business structural reforms, it closed 4 stores, Sogo Kashiwa, Seibu Asahikawa, Seibu Yao and Seibu Tsukuba, by the end of February 2017, and implemented voluntary retirements in October 2016 to optimize staffing.」

「Under the business structural reforms announced on 8 March 2016, Sogo Kashiwa and Seibu Asahikawa closed on 30 September 2016. On 2 August 2016, the company announced that Seibu Yao and Seibu Tsukuba would close as of 28 February 2017 and sought voluntary retirements to optimize staffing.」

「The company had decided to close Sogo Kashiwa and Seibu Asahikawa as of 30 September 2016 under the business structural reforms announced on 8 March 2016. However, judging that further structural reforms were necessary because the business environment remained challenging, it announced on 2 August 2016 that Seibu Yao and Seibu Tsukuba would close as of 28 February 2017 and that it would seek voluntary retirements.」