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3 Japanese Companies Report Strong Profits

In this week's Japan business headlines, two large retailers and a restaurant chain report strong profits despite the worst recession in more than 50 years.

Japanese retailing giant Ito-Yokado has become the country's most profitable supermarket group. The company earned an operating profit of $230 million in the last fiscal year, an 88-percent increase from the previous year.

The retailer attributed the rise to cost-cutting and a healthy profit from its convenience store unit, Seven-Eleven Japan.

Akira Miyauchi, Ito Yokado's senior managing director, told reporters in Tokyo that last year the company focused on profit growth rather than expansion.

Its rival, Aeon, the country's second-largest retailer, announced record revenue and operating profit of $205 million for the last business year. It also opened 11 new stores and began a restructuring plan.

The success of the two retailers is an exception. Many Japanese supermarkets say that sales continue to slump amid low consumer demand.

Yoshinoya, Japan's biggest beef-and-rice-bowl chain, says it posted record-high sales and profit for the last business year. Operating profit rose four-percent to $137 million.

Shuji Abe, Yoshinoya's president, told reporters that his company lifted sales by slashing prices, despite public concern over the discovery of mad cow disease in Japan last year.

The Japanese government says it may introduce early tax cuts to help fight deflation. Tokyo plans to unveil a tax reform plan in June, but the cuts, which could apply to both companies and individuals, may take effect before then. The government also hints that it may raise taxes on tobacco products next year. Finance Minister Masajuro Shiokawa says he hopes smokers will understand the move.