Fast Retailing reports rise in revenue and profits driven by Uniqlo International performance
Fast Retailing, the Japanese parent company of Uniqlo, has reported a 1.3% increase in revenue to £7.3 billion (1.2 trillion yen ) and a "large rise" in profits of 12.7%, reaching to £1.1 billion (189.2 billion yen) in the first half of fiscal 2022.
The company attributes the results to the strong performance of Uniqlo International, especially in the South Asia, Southeast Asia & Oceania, North America, and Europe regions. This was balanced by Uniqlo operations in Japan and Greater China declining, and a dip in sales of its GU brand.
In the six months to 28 February 2022 Fast Retailing reported the following results.
Uniqlo International:
- Revenues rise to £3.6 billion (593.2 billion yen), a 13.7% year-on-year growth.
- Operating profits rising to £600 million (100.3 billion yen), marking a 49.7% year-on-year growth.
The group said that for Uniqlo International operating profit generated by the North America and Europe regions constituted approximately 20% of the total. This year Fast Retailing announced that it would accelerate the opening of new stores in all its markets and flagships in the world's major cities.
The company faced a backlash in early March when it announced that it would not cease trading in Russia following its large-scale military invasion of Ukraine. It later u-turned its decision and has now announced that due to the "temporary closure" of operations it predicts UNIQLO Russia to report a loss in the second half of fiscal 2022.
Uniqlo Japan:
- Revenues fall by 10.2% to £2.6 billion (442.5 billion yen).
- Operating profits fall by 17.3% to £483.5 million (80.9 billion yen).
The retailer explained that the dip in sales was because it was being compared to a period last year that benefitted from strong sales of loungewear collections and its AIRism masks, combined with a lost sales opportunity of its Winter range.
Fast Retailing's GU brand has also seen revenues and profits declines and were impacted by delays in production and distribution that prevented strong-selling items to arrive in store in a timely manner and resulted in lost sales opportunities.
Global Brands (including New York brand Theory and France-based Comptoir des Cotonniers)
- 8.1% year-on-year rise in revenues to £352.5 million (58.9 billion yen)
- Operating profit of £6 million (1 billion yen), compared to an £48.5 million (8.1 billion yen) loss recorded in the first half of fiscal 2021.
The company added that it was focusing on expanding its e-commerce operations and working to combine the strengths of its physical store and e-commerce network to improve customer service.
The group did not make any changes to the estimates for full-year revenue and operating profit that it announced in January 2022.