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Uniqlo parent company's first quarter revenue reached 39.4 billion

2019-01-23 16:41:13 HuiTeng shoe Read

According to industry insiders, the main reason for the rapid growth of sales performance is cost performance + fabric innovation + quality manufacturing. Its high-speed growth has a strong reference for the current clothing retail enterprises, focusing on cost-effective products, and grasping the consumer's inner sensitivity of the clothing brand will Comply with the new trend of consumption, and then stand out.



Uniqlo parent company, Fast Retailing Co., Ltd. (hereinafter referred to as “Xunxing”) announced today (January 10) the financial report for the first quarter of the 2019 financial year (from September 1 to November 30, 2018). The total comprehensive income of Fast Retailing was 644.4 billion yen (about 39.411 billion yuan - the first textile net note), an increase of 4.4% over the same period of the previous year, and the total operating profit was 104.6 billion yen (about 6.401 billion yuan - - First Textile Network Note), a year-on-year decrease of 8.1%, showing a growth in revenue and a decrease in profit. The net profit attributable to owners of the parent company was 73.476 billion yen (approximately RMB 4.493 billion - the first textile net note), which was down year-on-year. 6.45%, among which, the overseas UNIQLO business segment's business segment steadily expanded, maintaining the trend of both revenue and profit growth. However, the UNIQLO business segment in Japan caused a decline in sales due to the warm winter, and the profit fell. The main cause of the decline.


Gross profit margin decreased by 1.0 percentage point over the same period of the previous year. Sales, general and administrative expenses as a percentage of revenue increased by 1.3 percentage points year-on-year. In addition, as the exchange rate of the Japanese yen against the US dollar fell at the end of November, the book value of assets held in foreign currencies increased after conversion to the Japanese yen, and the net foreign exchange gains under the financing income were 6.4 billion yen. As a result, the profit before income tax recorded a total of 111 billion yen (down 5.7% year-on-year), and the profit attributable to owners of the parent company recorded 73.4 billion yen (down 6.4% year-on-year).


According to industry insiders, the main reason for the rapid growth of sales performance is cost performance + fabric innovation + quality manufacturing. Its high-speed growth has a strong reference for the current clothing retail enterprises, focusing on cost-effective products, and grasping the consumer's inner sensitivity of the clothing brand will Comply with the new trend of consumption, and then stand out.


However, since 2018, after experiencing rapid global expansion and multi-brand/category layout, the growth center of fast fashion brands has gradually moved down. In the Chinese market, fast fashion brands are also facing problems such as sinking and the brand quality being criticized. Following the November 1st, 2018 TOPSHOP announced the closure of the Tmall flagship store, on December 10th, the British fast fashion retail brand New Look also announced that it will close its Chinese store in the near future. In the view of Changyu, an analyst at Changjiang Securities, the fast fashion brand is in cold in China. On the one hand, it shows that the demand of local consumers for clothing consumption is no longer just satisfied with the rich style, and the attention to quality and emotional factors is gradually increasing; It also reserved space for domestic brands that are deeply rooted in the local market.


Lei Yu believes that the fast fashion brand is weak, and the local mass brand has the advantages of localization and low-line channels, and is expected to achieve secondary growth on the basis of product strength, channel power and supply chain system upgrade. In 2017, China's adult mid-range casual wear market was about 245.4 billion yuan, accounting for 35.8% of the domestic casual wear market. From the perspective of industry growth, domestic consumers' preference for local apparel and footwear brands has provided an important consumer base for the development of local brands. At the same time, the strong consumption dynamics of low-line market residents are rooted in the low-line market. The development of local brands provides an economic premise. In the era of low-line consumption, international brands are constrained by low-line consumption power bottlenecks, lack of brand recognition, too strict conditions for entry, and preference of agents, facing the bottleneck of localization and the efficient coverage of the county market. The brand has an advantage.


Lei Yu said frankly that the current society has experienced a slowdown in economic growth and the recurrence of labor dividends. Consumers are faced with the contradiction between lower income growth expectations and higher personal debt ratios. Consumers' willingness to consume and consumer preferences are in a period of structural adjustment. Looking forward to 2019, the long-standing urban-rural dual structure provides a broad space for the rise of low-line consumption. The localization of overseas fast fashion brands is lagging behind and the sinking is hindered, which provides a rare opportunity for domestic brands. Secondly, In the process of upgrading consumption habits from branding to quality, non-price factors such as cultural identity, convenient experience and quality upgrading will have a subtle influence on consumers' consumption decisions and preferences, creating a brand image with temperature and anthropomorphic The consumer experience or focus on the next stage of clothing branding.


The following are the main contents of the first quarter earnings report of Fast Retailing 2019:


Japan UNIQLO


In the UNIQLO business segment in Japan, revenue in the first quarter of 2019 was 246.1 billion yen (down 4.3% year-on-year), and operating profit was 37.9 billion yen (down 29.9% year-on-year), both revenue and profit fell. . Same store sales (including online stores) recorded a year-on-year decline of 4.3%. Although the sales of new products and trendy goods such as premium lambskin sweaters, thick sportswear, fleece, and knit jackets are strong, while the temperatures in October and November remain high, the main sales of winter staples are sluggish. On the other hand, online store sales increased by 30.9% year-on-year, with strong performance, and the revenue share increased from 7.0% in the same period last year to 9.7%. In terms of profitability, due to the depreciation of the company's internal yen exchange rate, resulting in an increase in the cost of sales, coupled with the promotion of discounted sales activities in winter commodities, the gross profit margin decreased by 3.2% over the same period of the previous year. The sales, general and administrative expenses as a percentage of revenue increased due to the increase in logistics costs and the automation of warehouses, which increased by 2.2 percentage points year-on-year.


Overseas UNIQLO


In the overseas UNIQLO business segment, the first quarter revenue was 291.3 billion yen (up 12.8% year-on-year), and the operating profit was 52.5 billion yen (up 12.6% year-on-year), recording both revenue and profit growth. The revenue and profit of the overseas UNIQLO business segment significantly exceeded Japan's UNIQLO and became the largest business segment in the group.


Geographically:


Although the Greater China region was affected by the warm winter, it still recorded a double increase in revenue and profit. among them:


The operating profit of Mainland China maintained a good trend of double-digit growth. Moreover, the sales performance of online stores in mainland China continued to achieve double-digit growth in revenue due to the combination of stores and e-commerce.


South Korea has increased its profitability by controlling discount rates and using electronic tags (RFID) flexibly.


The same store sales in all markets in Southeast Asia and Oceania recorded growth, and the situation was good, with both revenue and profit both increasing substantially.


In addition, the United States has recorded a significant increase in revenue and profit as a result of reassessing the commodity composition of each region and the continued high growth in online store sales, thus steadily moving towards a surplus in this fiscal year. Europe has also achieved significant double growth in revenue and profit. Among them, Russia's performance is particularly good. In addition, as of September 2018, UNIQLO opened its first store in Amsterdam, the Netherlands, and in October of the same year, opened the largest global flagship store in Southeast Asia in Manila, Philippines.


GU


In the GU (Excellent) business segment, the first quarter revenue was 65.4 billion yen (up 7.7% year-on-year), and the operating profit was 8.5 billion yen (down 4.9% year-on-year), with revenue growth and profit decline. In terms of profitability, the gross profit margin decreased slightly, and the increase in expenses due to the promotion of advertising announcements led to a slight decrease in profit. However, during the period, the income trend began to turn into growth by adjusting the composition of the products to focus on the popular trend, and restarting TV commercials to strengthen market propaganda. Among them, the sales of sportswear and loose knitwear in promotional items are particularly strong. As the temperature drops, the sales situation of the jackets is also in good condition.


In the global brand business segment, the first quarter revenue was 40.7 billion yen (up 1.8% year-on-year), and operating profit was 2.7 billion yen (down 9.9% year-on-year), recording revenue growth and profit decline. Among them, in the Theory business, due to the strong sales in the United States, and the loss of discount sales, the profit increased significantly. The PLST business recorded a revenue increase, and as the number of stores increased, expenses increased and profits decreased slightly. The French brand Comptoirdes Cotonniers business, PRINCESSEtam tam business, and the US quality denim brand JBrand business continued to record operating losses. Sustainability "turning the power of clothing into the power of society" is based on this declaration, and through the clothing business, we strive to achieve sustainable development of the global environment and society.


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