TOKYO (Reuters) – The Japanese operator of global clothing chain Uniqlo said on Thursday operating profit rose 7.4% in the first quarter, a solid start to its plan to post a record profit for the fourth straight year.
Fast Retailing said operating profit was 157.6 billion yen ($996.84 million) in the three months to November.
That compared with 146.7 billion yen a year earlier, but was slightly below LSEG’s consensus forecast of 160 billion yen drawn by six analysts.
Fast Retailing kept its full-year operating profit forecast at 530 billion yen, following record earnings of 500.9 billion yen last year.
Known for its inexpensive, durable fleece and cotton shirts, Fast Retailing has long been considered a leader in consumer spending in Japan and more recently in China, where it has more than 900 Uniqlo stores on the mainland.
Domestic sales rose on a surge in duty-free shopping amid a tourism boom in Japan fueled by a weak yen.
But sales growth slowed in China, prompting the company to reduce the number of store openings and adopt a strategy of scrapping and building to retool underperforming locations with redesigned stores.
Improved profit margins and international brand awareness helped drive last year’s record results.
In its domestic market, it has also become a wage driver in the service industry.
In a bid to keep good workers, Fast Retailing said on Wednesday it will launch an aggressive wage increase for employees in Japan — one that continues after a 2023 increase that helped shake up the country’s long-term wage outlook.
Wages for full-time headquarters and sales staff will rise by as much as 11% from March, while annual wages for new hires will rise by around 10%, the company said.
($1 = 158.1000 yen)
