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TOKYO, Japan — Fast Retailing Co. cut its full-year operating profit forecast as unseasonably warm weather in its Japanese home market hurt sales of winter clothes for the retailer's Uniqlo brand of casual wear.
Operating profit will probably be 180 billion yen ($1.5 billion) in the year ending August 2016, the Yamaguchi-based company said Thursday. That compares with the company’s projection of 200 billion yen made in October, and the 199.6 billion-yen average estimate of 16 analysts compiled by Bloomberg.
Fast Retailing last month announced November same-store sales in Japan fell 8.9 percent due to "unusually hot weather." The weak performance threatens billionaire Chairman Tadashi Yanai's goal to turn Asia's biggest clothing retailer into a world leader with sales of 5 trillion yen by 2020. Fast Retailing also faces hurdles in the U.S., where low recognition of the Uniqlo brand has led to sustained losses.
Concerns are expected to arise over second-quarter earnings “as the firm enters its winter inventory disposal period,” Kuni Kanamori, an analyst at SMBC Nikko Securities Inc., wrote in a note last week.
By Monami Yui; editors: Stephanie Wong, Daryl Loo.
