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Fast Retailing Co. (9983), a Japanese retailer that sells Uniqlo branded apparel, forecast annual profit below analyst estimates as a slowdown in global economic growth reduces consumer spending.
Net income will probably be 84.5 billion yen ($1.08 billion) in the year ending August 2013, below the 87.5 billion yen average estimate of 21 analysts compiled by Bloomberg.
Net income will probably be 84.5 billion yen ($1.08 billion) in the year ending August 2013, below the 87.5 billion yen average estimate of 21 analysts compiled by Bloomberg.
The casual clothing maker, controlled by President Tadashi Yanai, has expanded outside Japan to reduce its reliance on its home market. The company is “cautious” about its China and Hong Kong sales because of a slowing global economic growth, it said yesterday. Fourth-quarter earnings in China and South Korean fell below target because of a slowdown, Chief Financial Officer Takeshi Okazaki said yesterday, without elaborating.
“What is driving the company’s profit is the overseas Uniqlo business,” said Mikihiko Yamato, deputy head of research for JI Asia in Tokyo. “Whether or not their overseas growth is continuing would be the biggest concern.”
Net income rose 32 percent to 71.7 billion yen for the last fiscal year, below the 78.7 billion yen average estimate of 20 analysts compiled by Bloomberg.
Overseas sales at its Uniqlo outlets rose 63 percent to 153.1 billion yen during the year, while domestic sales rose 3 percent to 620 billion yen.
China Closures
Fast Retailing closed as many as 60 outlets in China temporarily last month amid violent protests over a territorial dispute. The diplomatic spat flared up after Japan’s government said it would buy the islands, known as the Diaoyu in China and the Senkaku in Japanese, from their private Japanese owner.
China claims that it’s owned the islands for centuries, while Japan argues it took administrative control of them in 1895, lost its claim after World War II and had the islands returned to it in 1972.
The Yamaguchi, western Japan-based company forecast sales of 1.06 trillion yen for the current fiscal year, higher than the 1.05 trillion yen average estimate of 21 analysts compiled by Bloomberg.
Store Openings
By 2020, Fast Retailing plans to have 1,000 outlets in Japan, and the same amount in China and the same in North America and Europe combined, Yanai said yesterday. Another 1,000 will be opened in other parts of Asia and the company plans to achieve 5 trillion yen in sales by that year, he said. Its overseas sales are expected to exceed the domestic market in the 2015 fiscal year, he said in April. Yanai is Japan’s richest man with an estimated net worth of $11.6 billion, according to the Bloomberg Billionaires Index.
Fast Retailing opened the world’s largest Uniqlo brand casual clothing store in Tokyo’s Ginza district in March as part of its plan to develop its image as a global company, using English as an official language and hiring international staff. Yanai said then he aimed to make the outlet the biggest revenue generator in the network with annual sales of 10 billion yen.
The stock closed 1.3 percent lower to 17,810 yen in Tokyo trading yesterday. It has climbed 27 percent so far this year, compared with a 2 percent decline for the broader Topix index.
“What is driving the company’s profit is the overseas Uniqlo business,” said Mikihiko Yamato, deputy head of research for JI Asia in Tokyo. “Whether or not their overseas growth is continuing would be the biggest concern.”
Net income rose 32 percent to 71.7 billion yen for the last fiscal year, below the 78.7 billion yen average estimate of 20 analysts compiled by Bloomberg.
Overseas sales at its Uniqlo outlets rose 63 percent to 153.1 billion yen during the year, while domestic sales rose 3 percent to 620 billion yen.
China Closures
Fast Retailing closed as many as 60 outlets in China temporarily last month amid violent protests over a territorial dispute. The diplomatic spat flared up after Japan’s government said it would buy the islands, known as the Diaoyu in China and the Senkaku in Japanese, from their private Japanese owner.
China claims that it’s owned the islands for centuries, while Japan argues it took administrative control of them in 1895, lost its claim after World War II and had the islands returned to it in 1972.
The Yamaguchi, western Japan-based company forecast sales of 1.06 trillion yen for the current fiscal year, higher than the 1.05 trillion yen average estimate of 21 analysts compiled by Bloomberg.
Store Openings
By 2020, Fast Retailing plans to have 1,000 outlets in Japan, and the same amount in China and the same in North America and Europe combined, Yanai said yesterday. Another 1,000 will be opened in other parts of Asia and the company plans to achieve 5 trillion yen in sales by that year, he said. Its overseas sales are expected to exceed the domestic market in the 2015 fiscal year, he said in April. Yanai is Japan’s richest man with an estimated net worth of $11.6 billion, according to the Bloomberg Billionaires Index.
Fast Retailing opened the world’s largest Uniqlo brand casual clothing store in Tokyo’s Ginza district in March as part of its plan to develop its image as a global company, using English as an official language and hiring international staff. Yanai said then he aimed to make the outlet the biggest revenue generator in the network with annual sales of 10 billion yen.
The stock closed 1.3 percent lower to 17,810 yen in Tokyo trading yesterday. It has climbed 27 percent so far this year, compared with a 2 percent decline for the broader Topix index.
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