Uniqlo owner Fast Retailing is upping its profit expectations after another record performance

During the nine months to May 31, 2024, Fast Retailing reported revenue of ¥2.37trn (£11.5bn), up 10.4% year on year, while operating profit was also up 21.5% at ¥401.8bn (£1.95bn).

The group also said it saw “large revenue and profit increases” for the third quarter from March to May this year in all territories.

With an eye to business in Japan, Uniqlo hailed the success of its core summer staples including t-shirts and bra tops, which sold well during the quarter.

Sales in mainland China “struggled in comparison with the high bar set in the previous year” due to a slowdown in consumer appetite, unseasonable weather and products not proving a hit with local shoppers.

Fast Retailing hailed its new store openings in Europe, which continue to boost brand visibility, including openings in Edinburgh and Rome.

Regarding its Gu brand, Fast Retailing said revenue during the third quarter was up 5.4% at ¥86.8bn (£421.06m) while operating profit also jumped 10.9% to ¥14.1bn (£68.4m).

The sales of items at Gu continue to incorporate mass global fashion trends and Fast Retailing said the brand is starting to see “nascent opportunities” for its future international expansion.

In terms of outlook, Fast Retailing has upped its expectations for the full year and said it now expects operating profit to be up 24.6% to reach ¥475bn (£2.3bn) and revenue to also be up 11% at ¥3.07trn (£14.5bn)

The group said: “Looking at each business segment in turn, we predict Uniqlo International will achieve significantly higher revenue and profit in the second half of fiscal 2024 and the full business year. The same trends are predicted on a local currency basis.

“Breaking down the Uniqlo International segment into geographical regions and illustrating predicted performance in local currency terms, we expect the Greater China region to report a decline in revenue and a large contraction in profit in the second half of fiscal 2024, and a rise in revenue and a slight fall in profit for the full business year.

“In terms of store numbers, we predict our store network will total 3,604 stores by the end of August 2024, comprising 798 Uniqlo Japan stores (including franchise stores), 1,708 Uniqlo International stores, 476 Gu stores, and 622 Global Brands stores.”