/

Uniqlo quarterly profit up 45 percent after refocus

AFP-JIJI

As it refocused on a strategy aimed at luring thrifty shoppers, Uniqlo’s parent company said Thursday that quarterly net profit jumped by almost half from a year ago.

Fast Retailing’s net profit rose 45 percent to ¥70 billion in the fiscal first quarter to November, while revenue edged up 1.6 percent to ¥529 billion.

Asia’s biggest retailer — a rival of Zara, Gap and H&M — said sales were under pressure in September and October owing to “unseasonably warm weather.”

But “once temperatures dropped in November, same-store sales picked up,” it said in a statement, referring to locations that have been open for more than a year.

“This is pretty much in line with expectations, but the focus should still be on the second quarter,” Mike Allen, an analyst at Macquarie Capital in Tokyo, told Bloomberg News.

“They’ve recently had some trouble with revenue and there’s still a lot uncertainty about what happens going forward.”

The results come after Fast Retailing Chairman Tadashi Yanai conceded last year that an ill-fated price rise had been a mistake that hurt sales.

In October, Yanai backed off his ambitious annual revenue goal — ¥5 trillion by 2020 — as the company’s reported fiscal year net profit had more than halved to ¥48 billion.

It blamed the decline mostly on a rally in the yen, which shrinks the value of Japanese firms’ repatriated profits.

Expenses linked to closing locations in the United States and at home also ate into the bottom line, the firm had said.

On Thursday, the company left unchanged its annual forecast for a ¥100 billion net profit on revenue of ¥1.85 trillion.