Fast Retailing, the Japanese retail giant known for its brands Uniqlo and Theory, has experienced a strong recovery in its operating profit and is optimistic about future growth. Despite a 12.3% drop in revenue from the previous year, the company’s revenue increased by 6.2% in the fiscal year ending August 31. This growth was driven in large part by the Chinese market, with Uniqlo’s revenue in China, Hong Kong, and Taiwan experiencing a significant increase of nearly 17%.

While overall sales growth was not significant, Fast Retailing’s net profit surged by 88% to ¥169.85 billion ($1.54 billion) due to the impact of the pandemic in 2020. Looking ahead, the company expects its revenue to rise by 3.1% to ¥2.2 trillion ($20 billion) in the current year, with net profit projected to increase by 3% to ¥175 billion ($1.59 billion). Fast Retailing attributes this improved performance to the recovery of Uniqlo’s business operations, particularly in its home market of Japan.

Uniqlo Japan reported a 4.4% increase in revenue, reaching ¥842.6 billion ($7.66 billion), and a significant increase in operating profit to ¥123.2 billion ($1.12 billion). Same-store sales, including e-commerce, increased by 3.6% for the full year, with a stronger growth of 5.6% in the first half driven by demand for stay-at-home items and fall/winter collections. However, same-store sales only increased by 0.9% in the second half due to the state of emergency declaration and unfavorable weather conditions. E-commerce sales for Uniqlo Japan saw a healthy increase of 17.9%, accounting for 15.1% of total revenue. The company’s focus on full-price sales also contributed to an improvement in the gross profit margin for Uniqlo Japan.

Uniqlo International also reported significant growth, with revenue increasing by 10.2% to ¥930.1 billion ($8.46 billion) and operating profit expanding by 121.4% to ¥111.2 billion ($1.01 billion). Greater China, which includes China, Hong Kong, and Taiwan, was a key driver of this growth, with revenue rising by 16.7% to ¥532.2 billion ($4.84 billion) and operating profit expanding by 52.7% to ¥100.2 billion ($912 million). However, other regions such as South Korea, Southeast Asia, Australia, and India experienced declines in operating profit due to the heavy impact of the pandemic.

Fast Retailing saw a sharp sales recovery in North America and Europe once Covid-19 restrictions were eased, leading to a profitable second half and a significant reduction in full-year losses. The company’s GU brand achieved an increase in revenue but a decline in profit. GU’s e-commerce sales, however, increased by 50% compared to fiscal 2019 levels. Fast Retailing’s Global Brands segment reported a decline in revenue, but an improvement in operating loss compared to the previous year. The Theory brand performed well, returning to profitability with an increase in revenue.

Overall, Fast Retailing’s strong financial performance, driven by the recovery of its Uniqlo and Theory brands, demonstrates its ability to overcome the challenges posed by the pandemic. The company’s focus on improving gross profit margins, streamlining operations, and expanding e-commerce has been instrumental in driving its recovery. For more information, please visit [insert relevant link] and [insert relevant link].