Fast Retailing Posts Drop In Net Profit

Fast Retailing Co FRCOY reported a 29% drop in its net profit in the fiscal year ended Aug. 31. Fast Retailing's net profit for the year fell to Yen75 billion ($690 million), from a year-ago profit of Yen105 billion. The results included a 19.3 billion yen impairment loss on its J Brand premium denim label. Under international accounting standards adopted this year, Fast Retailing's operating profit for the year declined 2.8% to 130.4 billion yen. However, under Japanese accounting standards, profit surged 11.8% to 148.6 billion yen, versus analysts' estimates of 147.5 billion yen. Its sales gained 21% to Yen1.38 trillion versus Yen1.14 trillion. Fast Retailing's sales of the flagship Uniqlo brand jumped 65% outside of Japan, while sales gained 4.7% in Japan. Chief Executive Tadashi Yanai said, "Margins are likely to bottom out as management has increased its emphasis on profitability such as by introducing high-value-added products and focusing on opening large stores in prime locations." For the current fiscal year ending August 2015, the company projects net profit to surged 34% to Yen100 billion and revenue to gain 16% to Yen1.6 trillion. Fast Retailing shares gained 2.24% to close at $34.48 yesterday.