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Fast Retailing posts FY'17 profit surge, forecasts further growth

Fast Retailing Co. Ltd., owner of the Uniqlo and GU apparel chains, saw a surge in profit for fiscal 2017 and forecast income growth for the current financial year.

For the fiscal year ended Aug. 31, the Japanese retail giant's profit attributable to owners of the parent surged 148.2% year over year to ¥119.2 billion from ¥48.0 billion, thanks to brisk business at Uniqlo's overseas stores.

Basic EPS came in at ¥1,169.70, up from ¥471.31 in the year-ago period. The S&P Capital IQ GAAP EPS consensus estimate for the fiscal year was ¥1,088.07.

Revenue for fiscal 2017 came in at ¥1.862 trillion, up 4.2% from ¥1.786 trillion a year ago.

Revenue at Uniqlo's international business jumped 8.1% year over year to ¥708.1 billion from ¥655.4 billion, while the brand's domestic stores saw revenue increase 1.4% to ¥810.7 billion from ¥799.8 billion.

Uniqlo's overseas stores are expected to surpass its Japanese outlets in terms of revenue for the first time in fiscal 2018, Fast Retailing said, pointing to the brand's international business a key driver for its performance going forward.

Other brands bagged mixed results for fiscal 2017. GU's revenue rose 6.0% to ¥199.1 billion, while operating profit dropped 39.0% to ¥13.5 billion on lower-than-expected sales. Theory posted a large profit gain, while Comptoir des Cotonniers, Princesse tam.tam and J Brand posted full-year losses, Fast Retailing said, adding that denim label J Brand had ¥3.6 billion in impairment losses.

For the current fiscal year, Fast Retailing expects attributable profit to grow 0.6% year over year to ¥120.0 billion and revenue to jump 10.1% to ¥2.05 trillion by August 2018.

The company noted that it expects to expand to a total of 3,502 stores for all brands worldwide by the end of fiscal 2018.

It also forecast an annual dividend for fiscal 2018 of ¥350 per share, which is the same amount offered for fiscal 2017.

As of Oct. 11, US$1 was equivalent to ¥112.28.