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TOKYO -- Seven & I Holdings Co., operating 7-Eleven locations in Japan and parent company to the 7-Eleven convenience chain in the U.S., posted its first profit gain in four quarters, reported Bloomberg News.
The increases are attributed new restrictions on cigarette vending machines, which is driving Japan’s 26 million smokers to purchase cigarettes at convenience stores. To this end, net income rose 3 percent to $341 million in the three months ending August 2008, compared to a year earlier, reported Bloomberg News.
Operating profits from 7-Eleven convenience stores rose by 6.4 percent, and cigarette sales accounted for about 97 percent of the 3.7 percent gain in same-store 7-Eleven sales during the first half of the fiscal year, company president Noritoshi Murata told Bloomberg News.
Since July 1, Japan’s smokers are required to have a smart card to purchase cigarettes through the nation’s vending machines, which previously accounted for more than half of tobacco sales. To date, the majority of smokers haven’t applied for a Taspo card, designed to reduce underage smoking.