Fast Retailing Net Surges 35.8%

Citing slow sales in Japan, retailer lowers its earnings outlook for fiscal year.

TOKYO — Fast Retailing Co. Ltd. reported its net income for the nine months ended May 31 rose 35.8 percent versus the prior-year period, bolstered by strong sales in overseas markets.
Net income amounted to 72.5 billion yen, or $922.9 million at average exchange rates for the period.
The fast-fashion retailer’s operating income grew by 14.1 percent to 119.3 billion yen, or $1.52 billion.
Net sales rose 14 percent, totaling 743.5 billion yen, or $9.46 billion. Uniqlo’s sales in Japan increased by 4.4 percent to 503.2 billion yen, or $6.41 billion.

The brand’s sales in markets outside of Japan shot up 66.4 percent to 122.5 billion yen, or $1.56 billion, as the company continued its aggressive push at international expansion.


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“While profits continue to expand strongly in Asia, losses at Uniqlo USA expanded as sales at the New York 34th Street megastore and the New York SoHo global flagship fell short of target,” the company said in a release.
While Uniqlo’s sales in its home market still grew overall during the nine-month period, they contracted by 1 percent during the March to May quarter.
“Same-store sales at Uniqlo Japan contracted 5.4 percent year-over-year in the third quarter due to our strong focus on spring inventory which, with hindsight, probably detracted from sales of inter-season garments,” the company said. “In addition, the weather remained fairly cool during the March to May quarter and this dampened sales of summer clothing.”
Because of slow sales in the domestic market, Fast Retailing lowered its earnings outlook for the fiscal year ending Aug. 31. It now expects net income to grow 45.3 percent to 79 billion yen, or $989.3 million at current exchange rates. This is down from a previous estimate of 81.5 billion yen, or $1.02 billion.
The retailer predicts operating income for the year will increase 13 percent to 131.5 billion yen, or $1.65 billion.
Net sales are expected to grow 13.3 percent to 929.5 billion yen, or $11.64 billion.
Separately, Fast Retailing announced plans to open a new Uniqlo store in the So Ouest shopping mall west of Paris on Oct. 18. The store will have a total area of about 18,300 square feet spread over two floors and will carry all of Uniqlo’s lines for men and women. The company plans to hire 200 people to staff the store.