Fast Retailing Group Q3 FY'13 sales up 19.1%

As regards our fiscal 2013 estimates for UNIQLO Japan, while sales and operating income both fell ¥ 3.0bln short of our most recent estimates in the third quarter, subsequent sales data for June showed a healthy 20.5% year-on-year gain in same-store sales and so we have not made any changes to our full-year estimates for UNIQLO Japan.

We expect fiscal 2013 sales to increase by 8.5% year on year to ¥ 673.0bln and operating income to rise 3.6% to ¥ 106.0bln. The total number of UNIQLO stores increased by 5 stores to 833 stores (excluding 19 franchise stores) at the end of May 2013, and we expect this to grow to 834 by August 2013.

UNIQLO International: Asian Strength Fuels Further Large Gains in Sales and Income

UNIQLO International generated significant gains in both sales and income in the nine months to May 2013, with sales rising 56.1% year on year to ¥ 191.3bln and operating income expanding by an equally impressive 43.8% to ¥ 19.6bln.

The segment also reported considerable growth in sales and income for the third quarter from March to May 2013. UNIQLO's Asian operations exceeded our forecasts to generate large gains in both sales and income, particularly in China, Hong Kong and Taiwan where we have accelerated the pace of new store openings. However, cool spring temperatures chilled sales in South Korea, resulting in a slight contraction in profit for that operation in the March-to-May quarter.

Across the Pacific, we had expected to reduce the operating loss at UNIQLO USA during the second half of fiscal 2013 from March through August 2013. However, earnings in the third quarter hovered stubbornly at previous-year levels. This was due in part to unfavorable weather which dampened sales of spring garments, and also to a weaker-than-expected recovery in earnings at our three flagship stores in New York.

Meanwhile, the UNIQLO Westfield Garden State Plaza Store and the UNIQLO San Francisco Union Square Store, both opened in fall 2012, continue to generate favorable sales, as do the two new stores opened in malls in spring 2013. Looking ahead, we plan to open a total of 10 new stores in the United States in fall 2013 (six on the East Coast and four on the West Coast).