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Fast Retailing : Uniqlo owner Fast Retailing lifts full-year profit outlook as China shines

04/08/2021 | 04:46am EDT
FILE PHOTO: Women walk past a store of the Fast Retailing's fashion chain Uniqlo, in Beijing

TOKYO (Reuters) - Japan's Fast Retailing, the owner of clothing brand Uniqlo, on Thursday reported a 23% jump in half-yearly operating profit and raised its full-year profit estimate, helped by a robust performance in China.

The company has been among the most resilient retailers during the COVID-19 pandemic, as Uniqlo's focus on China and Japan helped it escape the worst of the downturn that hit the United States and Europe.

"Sales and profits in China exceeded our projections," Chief Financial Officer Takeshi Okazaki told reporters in Tokyo. "Profitability rose because we were able to limit discounts as we tried to improve our product value and branding."

Fast Retailing operates around 800 Uniqlo stores on the mainland, about the same number as its home market of Japan.

Earnings at the company's China business will continue to rise significantly throughout the year, while operations in the United States and Europe will post losses due to business restrictions to prevent the spread of COVID-19, he said.

Fast Retailing said operating profit was 168 billion yen ($1.53 billion) in the six months through February, against 136.7 billion yen a year earlier.

The company raised its full-year operating profit forecast to 255 billion yen from 245 billion yen. The average estimate in a Refinitiv poll of 15 analysts was 262.9 billion yen.

During the pandemic, Uniqlo briskly sold masks and saw strong demand for its stay-at-home jogging pants and other comfortable apparel.

However, the company is now dealing with crises in Myanmar and China that are upsetting its supply chain and one of its most important foreign markets.

Western brands including H&M, Burberry, Nike and Adidas have been hit by consumer boycotts in China amid concerns about forced labour in Xinjiang, a major cotton producer. Five brand ambassadors for Fast Retailing in China have quit amid the backlash.

CEO Tadashi Yanai told reporters that the company remains politically neutral and declined to comment on issues related to alleged human rights abuses in Xinjiang province.

Fires broke out at two of Fast Retailing's partner factories in Myanmar last month amid unrest that followed a military coup. The company has had to halt operations at some facilities in the country due to the imposition of martial law.

($1 = 109.6500 yen)

(Reporting by Junko Fujita and Rocky Swift in Tokyo; editing by Muralikumar Anantharaman, Shailesh Kuber and Jan Harvey)

© Reuters 2021
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Sales 2021 2 264 B 20 807 M 20 807 M
Net income 2021 176 B 1 615 M 1 615 M
Net cash 2021 561 B 5 157 M 5 157 M
P/E ratio 2021 52,0x
Yield 2021 0,56%
Capitalization 9 215 B 84 676 M 84 687 M
EV / Sales 2021 3,82x
EV / Sales 2022 3,41x
Nbr of Employees 57 727
Free-Float 51,4%
Duration : Period :
Fast Retailing Co., Ltd. Technical Analysis Chart | MarketScreener
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Technical analysis trends FAST RETAILING CO., LTD.
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus HOLD
Number of Analysts 17
Average target price 90 223,53 JPY
Last Close Price 90 230,00 JPY
Spread / Highest target 33,2%
Spread / Average Target -0,01%
Spread / Lowest Target -26,9%
EPS Revisions
Managers and Directors
Tadashi Yanai Chairman, President & Group CEO
Takeshi Okazaki Chief Financial Officer & Non-Executive Director
Masaaki Shintaku Independent Outside Director
Toru Hambayashi Independent Outside Director
Nobumichi Hattori Independent Outside Director
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