 The Japanese Fast Retailing bets for international expansion to face up to its group net profit´s drop. The parent company of Uniqlo said Thursday its group net profit in the September-February period fell by 24.7% to 41.67 billion yen on weak
domestic sales of fall and winter clothes at its Uniqlo casual wear chain.
 Fast Retailing assured it will step up efforts to expand its global presence. It will open its third Uniqlo store in New York this autumn, and will also open its first Thai Uniqlo store in Bangkok around the same time. At present, overseas stores account for only about 15% of the company's total sales. As of the end of March, the company had a total of 156 overseas Uniqlo stores in 10 countries and regions in Asia, Europe and the U.S. By comparison the company had 829 Uniqlo stores in Japan.
"We will further intensify" our focus in Asia, said Chief Executive Tadashi Yanai at a press conference after the release of the company's earnings results, noting it eventually aims to open 200 stores per year in the region, including 100 in China.
The group operating profit fell 17.8% to 82.06 billion yen on group sales of 457.33 billion yen, down 2.9%. It said demand for fall clothes was sluggish due to lingering summer heat, while sales of winter clothes were weak amid higher-than-usual temperatures in December.
For the business year ending in August, Fast Retailing revised upward its group net profit outlook to 60 billion yen, up from the previous forecast of 51 billion yen, on projected sales of 836 billion yen, down from an earlier forecast of 846 billion yen.
However, the operator of the Uniqlo chain of clothing stores on Thursday upgraded its profit outlook for the full business year ending August, showing resilience in the face of concerns over slumping domestic consumer sentiment after the March 11 earthquake.
But despite the decline, the result was still much stronger than the company's previously estimated Y30 billion in profits. Revenue declined 2.9% to Y457.33 billion from Y470.97 billion a year earlier, while operating profit dropped 18% to Y82.06 billion from Y99.89 billion a year earlier.
"We had a negative effect from the quake in March," said Nobuo Domae, the company's group executive vice president. But as the benefits of concentrating on more popular product lines begin to accrue, "we can expect same store sales will gain on year from April."
Looking forward, the company expects better profits at its overseas stores and cost reductions to help underpin its bottom line. For the full fiscal year ending August, the company revised upward its net profit forecast to Y60 billion from Y51 billion, citing a larger-than-expected contribution from its overseas operations. The company also raised its operating profit forecast to Y121.5 billion from Y113.5 billion, but cut its revenue outlook to Y836 billion from Y846 billion.
The company temporarily closed 160 stores in the quake-hit areas of northern Japan. Of these, 123 stores resumed operations within one week. Although 11 stores were still closed as of Thursday, the company expects six of them will resume operation soon.
Shares of Fast Retailing have fallen 12 percent since the quake, underperforming a 8.1 percent drop in the benchmark Nikkei average.
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