Fast Retailing lowers FY20 estimates as Uniqlo sales hit in Hong Kong, South Korea

Fast Retailing Fast Retailing Group said that consolidated revenue of 623.4 billion yen (5.70 billion dollars) for the first quarter were down 3.3 percent, while operating profit of 91.6 billion yen (0.84 billion dollars), dropped 12.4 percent. The company attributed decline in revenue and profit to that South Korea and Hong Kong reporting significant contractions in profit, the weather remaining persistently warm during the 1Q, and Uniqlo Japan profits improving to a lesser extent than originally expected. Due to 10.3 billion yen foreign exchange gain under finance income, first-quarter profit before income taxes reached 102 billion yen (0.93 billion dollars), down 8.2 percent and profit attributable to owners of the parent was 70.9 billion yen (0.65 billion dollars), down 3.5 percent.

Revenue at Uniqlo Japan declined 5.3 percent to 233 billion yen (2.13 billion dollars), while operating profit of 38.5 billion yen (0.35 billion dollars), rose 1.6 percent. Same-store sales declined 4.1 percent year-on-year. The company added that sales of cold-weather ranges proved sluggish in the face of persistently warm weather during the September to November quarter. Operating profit rose slightly on the back of a 2.3 point improvement in the gross profit margin and a reduction in SG&A expenses in monetary terms.

Uniqlo International revenues drop, GU posts positive rise

Revenue at Uniqlo International of 280.7 billion yen (2.57 billion dollars), dropped 3.6 percent and operating profit of 37.8 billion yen (0.35 billion dollars), declined 28 percent. The company said revenue and profit falls caused primarily by sharply lower revenue and profit figures from South Korea and Hong Kong. Uniqlo Greater China (Mainland China, Hong Kong, Taiwan) reported revenue rise but profit down, while Uniqlo South Korea reported an operating loss. Uniqlo South, Southeast Asia & Oceania reported further strong results characterized by double-digit rises in both revenue and profit, Uuniqlo North America reported rising revenue and profit and sespite double-digit growth in revenue, Uniqlo Europe profit declined slightly due to the foreign-exchange effect.

Revenues at GU of 72.9 billion yen (0.67 billion dollars), increased 11.4 percent, while operating profit of 12.3 billion yen (0.11 billion dollars), up 44.4 percent. The company added that same-stores sales increased on strong sales of lightweight outerwear, and knitwear featured in our advertising campaigns, profit expanded considerably and gross profit margin improved by 3.2 points on lower cost of sales and reduced discounting.

Global Brands revenue of 36.1 billion yen (0.33 billion dollars), declined 11.4 percent, while operating profit of 1.8 billion yen, was down 31.5 percent.Theory, PLST revenue and profit declined with sales of winter ranges struggling in the face of persistently warm weather. Comptoir des Cotonniers reported a similar loss to the previous year.

Fast Retailing lowers FY2020 consolidated estimates

The group has revised down initial estimate for FY2020 consolidated revenue by 60 billion yen and operating profit by 30 billion yen reflecting corporate performance in the first quarter and subsequent month of December, and also its decision to revise down initial second-half estimates for Uniqlo International to incorporate present circumstances in South Korea and Hong Kong.

FY2020 estimates for consolidated revenue are now 2.3400 trillion yen, up 2.2 percent, consolidated operating profit of 245 billion yen, down 4.9 percent, and profit attributable to owners of the parent of 165 billion yen, up 1.5 percent. The company forecasts an annual dividend per share in FY2020 of 500 yen, split equally between interim and year-end dividends of 250 yen each.

Picture:Facebook/Uniqlo