Amid Renewed Covid Measures, Quick Retailing Lowers FY Steering – WWD

TOKYO—Fast Retailing stated Thursday that it has lowered its full-year gross sales and working revenue projections amid new authorities measures to forestall the unfold of COVID-19 in Japan and different markets. In the meantime, it reported increased income and revenue for the primary 9 months of its monetary yr.

For the 9 months ended Could 31, the Uniqlo father or mother firm noticed web income surge by 67 p.c to 151.3 billion yen, or $1.38 billion). Working revenue gained 72.1 p.c to whole 227.8 billion yen. The retailer posted income of 1.7 trillion yen, up 9.9 p.c from the identical interval a yr earlier.

The corporate noticed elevated profitability throughout a number of of its enterprise segments and areas, which together with elevated gross sales helped to drive the sturdy revenue progress.

“The group achieved sturdy 3Q (March to Could 2021) rises in each income and revenue, with efficiency recovering in any respect 4 enterprise segments in comparison with the heavy impression of COVID-19 within the earlier yr,” Fast Retailing stated in an announcement. “Nevertheless, efficiency fell far in need of our newest plan, totally on lower-than-expected performances from Uniqlo Japan and GU.”

Based mostly on this, the retailer lowered its steering for full-year gross sales and working revenue. It now expects working revenue to extend by 64 p.c to 245 billion yen, down from a earlier forecast of 255 billion yen.

The corporate is predicting full-year income of two.15 trillion yen, a rise of seven p.c over the earlier fiscal yr. Its earlier steering put full-year income at 2.21 trillion yen.

Quick Retailing left unchanged its forecast for full-year web revenue. It’s anticipating progress of 82.6 p.c over the earlier yr, totaling 165 billion yen.

Uniqlo Japan reported vital will increase in each income and revenue over the nine-month interval. Gross sales grew by 12.7 p.c yr on yr to 675.1 billion yen, whereas working revenue elevated by 51 p.c to 119.5 billion yen.

“Constructing on stable leads to the primary half, with choices that fulfilled buyer demand for stay-at-home merchandise, there was sturdy progress within the third quarter, coming off a low base from the year-ago interval on the top of the pandemic,” the retailer stated. “Throughout the quarter, income elevated on the again of sturdy gross sales of summer season merchandise, together with Uniqlo U t-shirts, and Kando pants, in addition to common gadgets akin to loungewear and ultra-stretch lively pants. On-line gross sales continued to develop. The outcomes have been, nonetheless, in need of firm forecasts resulting from further authorities restrictions to include COVID-19, and product choices missing newsworthiness for patrons.”

Uniqlo’s worldwide operations moved again into the black through the interval, pushed by giant gross sales and revenue will increase within the better China area, in addition to improved profitability in North America, Europe, and different areas. Uniqlo Worldwide reported a 9.8 p.c enhance in nine-month income, totaling 739.6 billion yen. The phase’s working revenue grew by 88.7 p.c to 97.7 billion yen.

Whereas Uniqlo noticed sturdy progress in each gross sales and revenue within the better China area, the outcomes nonetheless fell in need of its personal projections.

In [the third] quarter, the mainland China market noticed extra subdued progress in demand as consumption patterns shifted to different segments, akin to home journey. As well as, the comparable figures a yr earlier had been extraordinarily sturdy, boosted by 2020 Could Labor Day gross sales as COVID-19 measures have been eliminated,” Quick Retailing stated.

In different areas, Uniqlo South Korea and Uniqlo South Asia, Southeast Asia and Oceania returned to an working revenue. Uniqlo North America and Uniqlo Europe reported sturdy income features and smaller working losses because the COVID-19 scenario improved through the third quarter. In a separate announcement Tuesday, Quick Retailing stated that it plans to open a brand new, 20,500-square-foot Uniqlo and Theory retailer on London’s Regent Road in spring of 2022.

GU, Quick Retailing’s trend-focused, low-priced vogue model, noticed will increase in each gross sales and revenue for the 9 months, in comparison with the identical interval a yr earlier. The phase’s income grew by 7.1 p.c to 200.8 billion yen, whereas working revenue gained 18.9 p.c to whole 24.3 billion yen. The corporate stated that enterprise efficiency held regular within the first half, however noticed appreciable will increase within the third quarter.

“In style gadgets akin to chef’s pants, ethereal shirts and coloured flared slacks contributed to the rise in GU income. Nevertheless, the outcomes have been under expectation, as a result of impression of further measures to regulate the COVID-19 outbreak in Japan, its largest market,” Quick Retailing stated.

Quick Retailing’s world manufacturers phase reported each a decline in income and a bigger working loss for the primary 9 months of its fiscal yr. Income declined by 3.3 p.c to 80.5 billion yen, whereas the working loss expanded to eight.9 billion yen from 6 billion yen in the identical interval a yr earlier. The Theory operation, nonetheless, reported a major rise in income and a transfer again into the black through the third quarter. Comptoir des Cotonniers reported a big rise in income and a barely smaller working loss in the identical interval.

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