Mainland retailer CP Lotus says it has turned the corner on its operational profit after axing loss making stores.

The board of the Hong Kong-listed company issued a profit advisory saying that based on preliminary review of the accounts to the end of May, it expects to post a profit of between RMB30 million and RMB35 million for the half year.

That compares with a loss of about RMB39 million in the same period last year.

CP Lotus operates 55 retail stores under the Lotus brand and is effectively a subsidiary of Thailand’s CP Group.

In the profit advisory statement, the company said the change of fortune was primarily due to the disposal of seven loss-making stores in April 2014 and reductions in administrative expenses and currency exchange losses.