Overseas growth in the 7-Eleven convenience store business drove a modest increase in profit for Japanese retail group Seven & I Holdings in the first quarter.

While the challenges of a shrinking population, falling household spending and corresponding lacklustre economy in its home market subdued local performance, offshore growth continues to underpin the company’s results.

Operating profit of 86.4 billion yen (US$781.2 million) was 2.7 per cent higher year-on-year in the three months to May.While 7-Eleven Japan is the nation’s largest convenience store chain, with more than 20,000 stores, the c-store sector is struggling to make headway amid growing competition from drugstores, and Seven & I Holdings’ Ito-Yokado supermarket chain, and its department stores are essentially standing still.

That makes overseas growth critical for Seven & I Holdings. While 7-Eleven Japan operating profit fell 6.9 per cent to 55.4 billion yen, overseas 7-Eleven profits surged 33 per cent. In Thailand, the chain has about 11,000 stores operated by local partner CP All. It has another 9500 stores in the US and more still under franchise agreements in markets including Malaysia, Australia and, more recently, Vietnam.