The Japanese retail group Fast Retailing Co. Ltd. closed the first half of the 2022/23 financial year with a significant increase in sales. The profit also exceeded the corresponding level of the previous year. In view of the recently surprisingly positive development and an increasing recovery in demand in China, the parent company of the clothing chain Uniqlo raised its forecast for the full year on Thursday.
Uniqlo’s foreign business remains the engine of growth
In the months of September to February, group sales reached 1.47 trillion Japanese yen (10.0 billion euros), which meant an increase of 20.4 percent compared to the same period last year. The main growth engine was Uniqlo’s international business. Despite pandemic-related problems in China at the beginning of the fiscal year, Uniqlo International division sales increased by 27.3 percent to 755.2 billion Japanese yen. The retailer explained that the significant increase was due to strong growth in Southeast Asia, North America and Europe.
In the home market of Japan, Uniqlo’s half-year sales increased by 11.9 percent to 495.1 billion Japanese yen. The global sales of the GU label grew by 18.5 percent to 145.5 billion Japanese yen, the total sales of the smaller group brands, which include Comptoir des Cotonniers and Theory, amounted to 70.2 billion Japanese yen, exceeding the level of the 19.1 percent in the same period of the previous year.
Although higher costs resulted in slightly lower margins, the group also significantly improved its operating profit thanks to strong sales growth. Operating profit reached 220.2 billion Japanese yen, up 16.4 percent from the first half last year. Net income attributable to shareholders grew 4.5 percent to 153.3 billion Japanese yen (1.0 billion euros).
The group is raising its forecast for the year
The available figures and the business development in the past few weeks prompted the management to slightly raise the targets for the full year, which lasts until the end of August. The sales forecast for 2022/23, which had previously announced 2.65 trillion Japanese yen, is now 2.68 trillion Japanese yen. which would correspond to growth of 16.5 percent compared to 2021/22.
The Group also raised the target for net income attributable to shareholders to 240.0 billion Japanese yen from 230.0 billion. He now only expects a decline of 12.2 percent compared to the previous year.