JAPAN TODAY


 

TOKYO — Uniqlo’s parent company said Thursday that quarterly net profit jumped by almost half from a year ago, as it refocused on a strategy aimed at luring thrifty shoppers.

Fast Retailing’s net profit rose 45 percent to 70 billion yen ($609 million) in the fiscal first quarter to November, while revenue edged up 1.6 percent to 529 billion yen.

Asia’s biggest retailer—a rival of Zara, Gap and H&M—said sales were under pressure in September and October owing to “unseasonably warm weather”.

But “once temperatures dropped in November, same-store sales picked up”, it said in a statement, referring to locations that have been open more than a year.

“This is pretty much in line with expectations, but the focus should still be on the second quarter,” Mike Allen, an analyst at Macquarie Capital in Tokyo, told Bloomberg News.

“They’ve recently had some trouble with revenue and there’s still a lot uncertainty about what happens going forward.”

The results come after Fast Retailing chairman Tadashi Yanai conceded last year that an ill-fated price rise had been a mistake that hurt sales.

In October, Yanai backed off his ambitious annual revenue goal—5.0 trillion yen by 2020—as the company reported fiscal year net profit had more than halved to 48 billion yen.

It blamed the decline mostly on a rally in the yen, which shrinks the value
of Japanese firms’ repatriated profits. Expenses linked to closing locations in the United States and at home also ate into the bottom line, the firm had said.

On Thursday, the company left unchanged its annual forecast for a 100 billion yen net profit on revenue of 1.85 trillion yen.

© 2017 AFP