Net profit rose 25% to ¥542.52 billion, beating Visible Alpha estimate
Fast Retailing, the Japanese owner of Uniqlo and other clothing brands, reported on Thursday a record annual net profit of ¥542.52 billion, equivalent to about $3.43 billion, for the 12 months ended August. Net profit rose 25% from the prior year, beating the ¥510.7 billion estimate in a poll of analysts by data provider Visible Alpha.
Annual revenue grew 17% to ¥3.963 trillion. For the fiscal year that began in September, the retailer projected revenue of ¥4.450 trillion, up 12% from the latest year, and net profit of ¥560.00 billion, up 3.2%.
Uniqlo’s North America sales made up 9.2% of the company’s total revenue in the latest fiscal year, with Europe accounting for 13%. By comparison, Japan contributed 27% and the combined markets of China, Hong Kong and Taiwan contributed 18%.
The U.S. and Europe have become increasingly important regions for Fast Retailing, which is seeking growth beyond Japan and China as part of its diversification strategy, the company said.
The Japanese retailer set separate annual regional revenue targets of ¥1 trillion, or about $6.33 billion, for Uniqlo’s operations in North America and Europe within roughly five years.
To support the expansion, Fast Retailing has been adding stores in the U.S., Europe and Southeast Asia in recent quarters while reducing the number of locations in China. The apparel retailer is also taking steps to shore up its business in the world’s second-largest economy.
Fast Retailing said it planned to reopen its Uniqlo flagship store in Shanghai on Oct. 30 and to revamp several stores in the Chinese city during the current fiscal year.
The company, which trades under the code 9983, is the parent of Uniqlo and other clothing brands. It said the record annual profit was driven by strong earnings across regions.
The projected 3.2% net profit growth for the new fiscal year marks a deceleration from the 25% advance recorded in the year just ended.