Fast Retailing's Uniqlo Sales Continue Slump With 14.5% Drop in November
Fast Retailing Co., Asia’s biggest clothing chain operator, said sales at its Uniqlo stores in Japan fell for the fourth straight month even after offering discounts on thermal wear and down jackets.
Domestic sales at stores open at least a year declined 14.5 percent in November from a year earlier, the Yamaguchi City, Japan-based company said in a statement today. Revenue per customer fell 8.1 percent.
“It’s a negative surprise for me,” Masamitsu Ohki, a Tokyo-based fund manager at Stats Investment Management Co., which owns shares of Fast Retailing, said in a phone interview today. “I had expected a 10 percent increase or at least for sales to remain unchanged.”
Fast Retailing, which has lost 23 percent of its market value this year, saw Uniqlo’s monthly domestic same-store sales plunge 24.7 percent in September, the biggest drop in seven years. The clothier has forecast that full-year net income will fall for the first time in four years as it offers more discounts amid increasing competition.
Demand during November fell even after record one-day sales of about 10.2 billion yen ($121 million) on Nov. 20, the first day of a four-day promotion campaign.
Fast Retailing gained 1 percent to 13,390 yen at the 3 p.m. close on the Tokyo Stock Exchange before the announcement. The stock has slid about 7 times faster than the 3.35 percent decline for the broader Topix index.
The clothing chain reduced the price of its Heattech turtleneck by 34 percent to 990 yen and that of the Ultra Light Down jacket by 33 percent to 3,990 yen during the campaign. Uniqlo’s domestic same-store sales may fall 4.7 percent in the fiscal year ending in August, it said in October.
“We don’t think it was a bad number since we had very good sales a year earlier,” company spokesman Daisuke Hase said in a phone interview today. “We recorded very good sales in promotions this month. We are almost in line with our projections."
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