TOKYO — Fast Retailing said Thursday that it posted record profit and sales for its most recent financial year, and that revenue from Uniqlo international exceeded that of Uniqlo Japan for the first time. The results were bolstered by profit growth from both Uniqlo international and Uniqlo Japan.
For the fiscal year ended Aug. 31, Fast Retailing’s net profit grew by 29.8 percent to 154.81 billion yen, or $1.37 billion. Operating profit rose 34 percent to 236.21 billion yen, while net sales gained 14.4 percent to total 2.13 trillion yen. This marked the first year that Fast Retailing has posted revenue exceeding 2 trillion yen. Tadashi Yanai, the company’s chairman, president and chief executive officer, has said he aims to reach 3 trillion yen in net sales, while his medium-term goal is to become the world’s number-one apparel retailer.
Revenue from Uniqlo’s international business jumped 26.6 percent year-on-year to 896.3 billion yen, overtaking the brand’s business in its home market for the first time. Uniqlo Japan’s revenue increased by 6.7 percent to 864.7 billion yen, helped by a 29.4 percent in e-commerce sales, which totaled 63 billion yen domestically.
Takeshi Okazaki, Fast Retailing’s chief financial officer, said Uniqlo will focus on continuing to grow its e-commerce business in Japan, rather than on opening many additional stores in the country. But internationally, it will continue to expand through both store openings and online sales.
Uniqlo plans to increase its rate of international expansion, adding around 100 new stores in the Greater China region, as well as about 50 across Southeast Asia and Oceania, during its 2019 fiscal year.
At a press briefing Thursday, Yanai said Fast Retailing is working to rethink every element of its business from scratch.
“We will innovate all aspects of retail and the way we work starting from zero, from the supply chain to communications to organization,” he said. “And we will make new products for people all around the world, with people all around the world.”
Fast Retailing said Wednesday that it is working toward full automation of its warehouses worldwide, and on Thursday, Takuya Jimbo, a group senior vice president, said the company will be making major changes to its supply chain.
The goal with the revamped supply chain, Jimbo said, is to not produce, transport or sell any unnecessary items. Instead, the company aims to always have the products customers want, as well as to sell out of all products. It will also recycle all products that customers no longer need.
In order to realize these goals, Fast Retailing has formed partnerships with top players from around the world, including Google, Accenture, Toray, Shima Seiki and Daifuku. Moving forward, it plays to tag every one of the 1.3 billion pieces of clothing it makes every year with an RFID. This will allow the company to track the production progress of products, where they are in which warehouses, and how many are on shop floors and in back rooms.
Yanai, who turns 70 in February, is often asked about his retirement plans, but he has yet to announce a specific succession program.
“For now, I’m not thinking about retiring, and I want to continue working as long as it is necessary,” he said Thursday. “Okazaki and Jimbo, who are here today, as well as other company executives, are growing and developing well, so I think even if I weren’t here they would be up to the task of running the company without me.”
Fast Retailing also released its guidance for its current fiscal year, ending Aug. 31, 2019. It expects net profit to increase by 6.6 percent to 165 billion yen.
The company is predicting a yearly operating profit of 275 billion yen, up 8.9 percent from the previous year. It forecasts sales growth of 8 percent, for a total of 2.3 trillion yen.