Uniqlo owner Fast Retailing Co. forecast operating profit ahead of analysts’ projections for the current fiscal year, citing robust sales in both home and overseas markets.
(Bloomberg) — Uniqlo owner Fast Retailing Co. forecast operating profit ahead of analysts’ projections for the current fiscal year, citing robust sales in both home and overseas markets.
Operating profit for the period through August 2024 will reach ¥450 billion ($3 billion), compared with the ¥423 billion average estimate by analysts, the apparel maker said in a statement Thursday. Sales are seen at ¥3.05 trillion, in line with projections.
Asia’s largest apparel maker is entering a new expansion phase, seeking to eventually reach founder Tadashi Yanai’s goal of reaching ¥10 trillion in sales to become “a true global player.” The company expects to reach half of that in about five years. Bolstering that scenario, international revenue for Uniqlo, Fast Retailing’s most important brand, made up more than half of group revenue for the first time.
“I see our path to achieve ¥5 trillion in sales with our current way of doing business by placing flagship stores in major cities around the world,” Yanai said in a briefing. “I don’t think it’s tremendously difficult to double the scale to achieve ¥10 trillion.”
Fast Retailing relies on Japan and China for the majority of its revenue, and is shifting its focus to markets such as North America, Europe and other parts of Asia.
The stock has climbed about 26% this year, roughly in line with the benchmark Topix Index.
Fast Retailing’s operating profit rose 28% to ¥381 billion for the year ended August, on sales of ¥2.77 trillion, with both reaching a record. Dividends were raised by ¥40 to ¥330 for the current year.
“We are steadily diversifying our earnings pillars,” said Chief Financial Officer Takeshi Okazaki. “Uniqlo’s business in North America, Europe, Southeast Asia entered growth stage and continues to expand its customer base. Business in greater China have recovered in the second half, returning to expansion phase.”
(Adds CEO, CFO comments in fourth, eighth paragraphs.)
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