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Uniqlo reports loss but growth plans on track


Fashion retailer Uniqlo’s UK arm made operating losses in the year to August 2011, according to a trading statement published last night by the business’s Japanese parent company Fast Retailing.

Overall group profits also contracted, with operating income down 12.1 per cent to 116.3 billion yen (£970 million) and net income dropping 11.9 per cent to 54.3 billion yen.

Fast Retailing said that, although group sales edged up 0.7 per cent, the main factor behind the decline was a slowdown in operating income at its Japan-based stores.

The Uniqlo brand’s international development continues apace though, with sales expanding 28.7 per cent year-on-year to 93.7 billion yen and operating income increasing 40.6 per cent to 8.9 billion yen.

Asia continues to be the company’s major growth market, and it now boasts 181 stores across countries such as China, Hong Kong, South Korea and Taiwan, but the firm’s New York Soho Store has also performed well and continued to generate double-digit sales growth over the 12-month period.

Uniqlo operations in both the UK and Russia “fell short of targets”, but stores have continue to open in Britain, with a revamped London Regent Street outlet unveiled earlier this morning following the launch of a shop in Westfield Stratford City last month.

The plan for future store openings is for them to follow a global standard, with the retailer ensuring that all fittings, fixtures and digital panels are consistent across all locations. There is also a strong focus on introducing in-store technology.

Meanwhile, two further New York stores will be opened before the end of October, and Fast Retailing is confident that its global operations in the year ahead will improve significantly.

“Fast Retailing predicts both sales and income will increase in fiscal 2012, with Uniqlo International continuing to generate strong gains in both sales and income, and profits improving at Uniqlo Japan,” it said.

“For the full business year through August 2012, consolidated sales are estimated to rise 17.6 per cent year-on-year to 965 billion yen, operating income is forecast to increase 16.4 per cent to 135.5 billion yen and net income is expected to expand 30.6 per cent to 71 billion yen.”

Published on Thursday 13 October by Editorial Assistant

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