Fast Retailing Q3 misses expectations but clearance timing shift means full-year is on target
today Jul 11, 2019
The period up to May 31 saw it missing analysts’ earnings expectations with a fairly anaemic net profits rise to ¥44.64 billion ($411 million), up from ¥44.18 billion a year earlier. Analysts had been predicting the figure to be over ¥47 billion.
Its revenue rise also missed estimates, although at 7.3% to ¥555.1 billion, it was a relatively healthy increase given the challenging conditions in the last three months.
It all means the company still expects revenue to be ¥2.3 trillion for the full year with net profit of ¥165 billion.
So what actually happened during the latest quarter? Its Japanese sales fell 0.5% and its operating profits there were down a hefty 7.5%, although this was partly driven by the fact that the big Uniqlo clearance sale moved from May into June this year. The company had already said in its June sales report for Uniqlo that this move had been the right one and had boosted full-price sales.
Uniqlo sales and operating profits outside of Japan both increased 15% in in Q3 as China, Southeast Asia and Oceania all performed well and are expected to continue to do so in Q4.
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