(April 9): Fast Retailing Co raised its full-year operating profit outlook on robust demand for its Uniqlo apparel in the US and Europe, bolstered by continued growth in Japan.
The Japanese clothing company now sees operating income of ¥700 billion, compared with its previous guidance of ¥650 billion for the full year. That’s well above analysts’ average estimate for ¥657 billion for the fiscal period through August.
The results highlight how Uniqlo’s growth is increasingly driven by overseas markets, particularly the US and Europe, even as Japan remains a stable base. As the company pursues an ambitious ¥10 trillion annual sales target, with expansion in North America and other global regions central to that strategy, this period’s performance offers a gauge of whether effort can keep up its momentum as demand conditions diverge across markets.
“It seems that restructuring efforts have been underway, and there have been signs of improvement,” said Taku Sugawara, analyst at Iwai Cosmo Securities Co. “The key question is whether this momentum is continuing.”
The full-year revenue forecast is now ¥3.9 trillion instead of ¥3.8 trillion, and higher than analysts’ prediction for ¥3.81 trillion.
For the three months ended February, operating profit was ¥190 billion. That compares with the ¥161 billion average projection by analysts, according to data compiled by Bloomberg.
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Last month, the company struck a landmark deal with Major League Baseball that brought the Japanese company to the forefront of the newly renamed Uniqlo Field at Dodger Stadium. Founder Tadashi Yanai previously told Bloomberg that he is targeting ¥3 trillion in annual US sales, with a goal to expand deeper into Middle America.
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