The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
TOKYO, Japan — Uniqlo owner Fast Retailing Co. lowered its full-year outlook, hurt by heavy discounts on winter clothes after a warm winter and losses stemming from its weak overseas brands, even as it turned in a better-than-expected second-quarter profit.
For the full year through August, it forecast an operating profit of 260 billion yen ($2.34 billion), versus its previous estimate of 270 billion yen.
The retailer, however, reported a rise in its operating profit for the second quarter to 68 billion yen, from 57 billion yen a year earlier, on growth in China and its online business.
That beat an average estimate of 64 billion from six analysts polled by Refinitiv.
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Operating profit for Uniqlo's China business has been growing by double digits in recent quarters despite concerns of a slowing economy. The company expanded to 633 locations in China in the last fiscal year, up 78 stores from a year earlier, while in Japan it went down 4 stores to 827.
Uniqlo has found it tough to cope with unexpected weather patterns in the past few years. After struggling with a shortage of popular winter items in the past, the Japanese company last winter overcompensated by ordering too much inventory.
Fast Retailing posted a surprise drop in profit in the first quarter as unseasonably warm weather hit sales of winter clothes.
By Ritsuko Ando; editor: Himani Sarkar.
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