Fast Retailing Posts 88% Increase in Full-year Net Profit
TOKYO — For its most recent fiscal year, Fast Retailing posted an 88 percent increase in its net profit as well as sales growth. The results were boosted by a low comparative base due to weak performance in the previous year, marked strongly by the pandemic.
Uniqlo’s parent said its net profit for the 12 months ended Aug. 31 grew 88 percent to 169.85 billion yen, or about $1.5 billion at current exchange rates.
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The company’s operating profit for the period increased by 66.7 percent on the year to 249.01 billion yen.
Fast Retailing posted yearly sales growth of 6.2 percent for a total of 2.13 trillion yen.
Both Fast Retailing’s Uniqlo Japan and Uniqlo international business segments saw increased revenues during the period. In Japan, the company’s home market, Uniqlo’s sales grew by 4.4 percent to 842.6 billion yen. Same-store sales increased by 5.6 percent in the first half of the year, but only by 0.9 percent in the second half, which the company attributed to “the declaration of a state of emergency and unfavorable weather.”
Uniqlo’s international sales gained 10.2 percent year-on-year to 930.1 billion yen. The greater China region recorded record results, with revenue rising 16.7 percent year-on-year to 532.2 billion yen. In the U.S., Uniqlo’s full-year revenue was down, but the company managed to cut its operating loss in half. The Uniqlo’s North America e-commerce sales showed strong growth throughout the year, rising by approximately 70 percent.
The GU business also saw positive results, with revenue for the year gaining 1.4 percent to total 249.4 billion yen. Fast Retailing said it will continue to grow the GU business by expanding its network of stores, primarily in Japan.
Its global brands business, which includes Theory, PLST, Comptoir des Contonniers and Princesse Tam Tam, saw revenues slip 1.3 percent to 108.2 billion yen, and the segment posted an operating loss of 1.6 billion yen.
At a press conference Thursday to discuss the results, Tadashi Yanai, Fast Retailing’s chairman, president and chief executive officer, outlined what he sees as the most important issues facing the company at the moment, and what it will focus on moving forward. One area that the retailer has emphasized in recent years is sustainability, and it will continue to do so in the future.
“It is out job to reduce our environmental impact through our daily business activities and to seek to achieve sustainable growth for society so that we can make the world a better place through our business and products,” Yanai said.
Yanai added that the company will seek to improve working conditions at its partner factories by carrying out ongoing monitoring activities and taking tough action if any human rights violations are discovered. It will also aim to ensure an even higher level of traceability throughout the supply chain.
The executive also discussed globalization, saying that despite the COVID-19 pandemic forcing countries to look inward, attempts to drive a wedge between nations will never work.
“No company has ever succeeded by closing its doors to others. No country has ever prospered by remaining closed to others,” Yanai said.
Fast Retailing also released its guidance for its current fiscal year, ending Aug. 31, 2022, saying that it expects both revenue and profit will decline in the first half, based on an assumption that COVID-19 will continue to have an impact on people’s mobility and cause temporary store closures, as well as possible production or logistic delays. However, the company said it anticipates a sizable increase in sales and operating profit in the second half of the year, as it expects pandemic-related restrictions to ease and business conditions to return to normal.
Based on these assumptions, the retailer is forecasting a 3 percent yearly increase in net profit for a total of 175 billion yen.
The company expects its operating profit for the year will rise by 8.4 percent to 270 billion yen.
Fast Retailing is predicting growth of 3.1 percent in its overall revenue for the year.
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