Uniqlo parent Fast Retailing says profit slid 2% in first quarter By Reuters

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© Reuters. Fast Retailing’s Uniqlo sign boards are displayed at a casual clothing store in Tokyo, Japan January 11, 2023. REUTERS/Issei Kato

TOKYO (Reuters) – Japan’s Fast Retailing Co, owner of clothing brand Uniqlo, reported on Thursday that first quarter earnings had slid 2% following last year’s record figure.

A day after announcing plans for big wage rises, the company said operating profit had been 117.1 billion yen ($889.82 million) in the three months to November 2022, compared with 119.4 billion yen a year earlier.

The consensus forecast was for 135.3 billion yen, according to the average of five analyst estimates collected by Refinitiv.

Profit had declined at Uniqlo operations in greater China and Japan, while earnings in all other regions had increased, Fast Retailing said in a statement. The company held its full-year operating profit forecast at 350 billion yen.

The company, Japan’s biggest retailer, sent shockwaves through the country on Wednesday by saying it would lift its employees’ wages by as much as 40%. That greatly satisfied policymakers, who had been urging employers to raise wages to help offset the highest inflation in a generation.

Fast Retailing, which operates more than 3,500 clothing stores worldwide, reported record profit last fiscal year, as growth in North America and Europe compensated for a slump in China, where demand had been slowed by pandemic containment measures.

The company is seen as a bellwether for the Chinese market, where it produces many of its goods and operates almost 900 Uniqlo stores, more than in Japan.

Fast Retailing’s share price slid 2% in Tokyo trade, compared to a flat benchmark index.

($1=131.6000 yen)

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