Japan-based Fast Retailing Co. (JP:9983) delivered strong first-quarter results with higher revenues and profits. The company reported a consolidated net profit of ¥131.9 billion for the quarter, marking a 22.4% increase year-over-year. Meanwhile, revenue grew by 10.4% to reach ¥895.1 billion. The growth was mainly driven by robust sales of its Uniqlo brand in Japan. Fast Retailing shares dropped by nearly 7% on Friday.
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Fast Retailing is a global retail group, managing several fashion brands, including UNIQLO, GU, Theory, etc.
Fast Retailing Flags China Slump
The company’s performance in China sharply contrasted with its strong results in its home market, Japan. Sales in Japan increased by 9% to ¥267 billion. However, its revenue and profits in Mainland China declined due to an inadequate product mix for warmer winter conditions. Additionally, the decline in China prompted the company to slow down new store openings and revamp underperforming locations with redesigned stores.
On the other hand, the company also posted strong results in North America and Europe, where it is aggressively expanding its operations.
Moving ahead, Fast Retailing upheld its full-year operating profit projection of ¥530 billion, aiming for a fourth consecutive year of record earnings. In the first quarter ending in November 2024, the company’s operating profit grew 7.4% year-over-year to ¥157.5 billion.
Is Fast Retailing a Good Investment?
According to the consensus among analysts on TipRanks, 9983 stock has been assigned a Hold rating based on two Buy and six Hold recommendations from analysts. The Fast Retailing share price target is ¥50,232.04, which is 3.23% above the current share price level.
