TOKYO — Fast Retailing said Thursday that while its revenue for its fiscal first quarter was up, profit dipped compared with the same period a year earlier. Much of the decline was due to a sharp drop in Uniqlo Japan’s profit, which was affected by an early winter that was warmer than usual.
The Uniqlo parent’s net profit for the three months ended Nov. 30 dropped 6.4 percent to 73.4 billion yen.
Operating profit for the period was down by 8.1 percent year on year to 104.6 billion yen.
The company posted net sales of 644.4 billion yen, representing growth of 4.4 percent over the same period a year earlier.
Uniqlo Japan saw a decline in both profit and revenue, due to what it called the “warm winter effect.” Operating profit for the segment was down 29.9 percent to 37.9 billion yen, while net sales contracted by 4.3 percent to 246.1 billion yen. Same-store sales among Uniqlo Japan were down by 4.3 percent year on year.
“While new ranges and trendy products such as premium lambswool sweaters, boa fleece sweatshirts, fluffy fleece and knitted coats sold well, sales of core winter items struggled overall in the face of especially mild weather in October and November,” the company said in a release.
Uniqlo international, on the other hand, enjoyed growth of both sales and profit. Its operating profit grew by 12.6 percent on the year to 52.5 billion yen, while its revenue gained 12.8 percent to 291.3 billion yen.
“Uniqlo International revenue and profit far outstripped that of Uniqlo Japan in the first quarter, making it the largest business segment in the Fast Retailing Group. In terms of individual markets, Uniqlo Greater China reported higher revenue and profits despite the mild winter weather. The operation in mainland China continued strong, reporting double-digit growth in operating profit. Mainland China also achieved further double-digit growth in online sales, thanks to efforts to smoothly unify physical and online store operations,” the Fast Retailing release said. “Uniqlo USA reported significant increases in both revenue and profit on the back of a successful review of regional product mixes and continued strong online sales growth, and efforts to help the operation turn a profit in the current financial year are proceeding smoothly.”
Fast Retailing left unchanged its guidance for the current fiscal year, ending Aug. 31. It expects net profit to grow by 6.6 percent to 165 billion yen.
The company is predicting its operating profit will gain 14.3 percent on the year, to reach 270 billion yen.
It is forecasting revenue growth of 8 percent year on year, for a total of 2.3 trillion yen.