Fast Retailing Co, operator of the Uniqlo clothing chain, said Thursday it posted a record net profit of 279.29 billion yen for its first half through February, up 19.6 percent from a year earlier, driven by strong sales at home and abroad.
The Japanese company also raised its full-year earnings forecast ending August, expecting net profit of 480 billion yen and operating profit of 700 billion yen on sales of 3.9 trillion yen, compared with its January forecast of 450 billion yen and 650 billion yen, respectively, on sales of 3.8 trillion yen.
Chief Financial Officer Takeshi Okazaki said at a press conference that the conflict involving Iran and rising crude oil prices “will inevitably have some impact if the situation persists,” as the company manufactures products using petroleum-derived fabrics.
Still, Fast Retailing was able to raise the outlook, owing to solid results in the first six months and a weaker yen.
While higher fuel costs are expected to raise shipping costs in some areas, the company said they are “unlikely to have a significant impact on production and logistics” as it has already secured materials for the current fiscal year.
The company will closely watch the situation in the Middle East and “all we can say is that we will take all appropriate steps as needed,” the CFO said.
Tadashi Yanai, chairman, the company’s president and chief executive, said, “I want such an unnecessary war to be stopped.”
During the September-February period, operating profit jumped 31.7 percent to 400.67 billion yen, while sales increased 14.8 percent to 2.06 trillion yen.
Operating profit for Uniqlo’s overseas operations surged 38.9 percent to 234.1 billion yen, driven by growth in North America and Europe.
The sharp rise came as Uniqlo became less dependent on winter clothing and less affected by temperatures. The shift helped drive strong year-round sales, while new flagship stores boosted global brand recognition.
Reflecting strong performance in North America and Europe, the company said it expects to hit sales targets of 500 billion yen in Europe and 300 billion yen in North America in the current fiscal year, one year ahead of schedule.
Uniqlo’s operations in Japan, meanwhile, saw operating profit rise 14.1 percent to 111.4 billion yen, supported by strong sales of winter clothing.
© KYODO
