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DALLAS - 7-Eleven Inc., the world's No. 1 convenience store chain, today said it plans to close up to 120 stores to increase profits. The company also reported an 18 percent rise in fourth-quarter profits, which resulted in part from lower gasoline prices.
The retailer said its core earnings for the quarter ended Dec. 31 rose to $14.6 million, or 14 cents a share, from $12.4 million or 12 cents a share a year earlier. Core earnings exclude a $3.2 million after-tax asset impairment charge related to store closings and a $5.7 million after-tax impact associated with an accounting change.
Net earnings for the quarter were $17.1 million, or 16 cents a share, compared with $14.2 million, or 14 cents a share, a year ago.
Looking ahead, the company said it will increase investments in technology and focus on reducing costs.
"The combination of all of these factors, plus a weak U.S. economy and a competitive retail environment, is expected to cause earnings pressure in 2002," 7-Eleven said in a statement.
"In spite of this pressure, the company anticipates continued improvement in its traditional convenience business and, accordingly, is accelerating key growth initiatives," it added.
Seven-Eleven President and CEO Jim Keyes said two areas of differentiation for 7-Eleven include its proprietary fresh food business and its financial services business.
"We anticipate both of these businesses will contribute to the bottom line in 2004," he said in a statement.