Jan. 11 (Bloomberg) -- Fast Retailing Co., Asia’s largest apparel retailer, climbed to a record in Tokyo trading after boosting its annual profit forecast on higher overseas sales of its Uniqlo clothing brand.
The stock rose as much as 4.3 percent to 23,520 yen, headed for the highest close since Bloomberg started tracking the data in 1997, before trading at 23,220 yen at 9:36 a.m. in Tokyo. The Topix index gained 1.2 percent. Net income will probably be 87 billion yen ($987 million) for the year ending August, higher than its previous forecast of 84.5 billion yen, the Yamaguchi, Japan-based company said yesterday in a statement.
Billionaire Tadashi Yanai, Japan’s richest man, is expanding his chain overseas to reduce reliance on Japan, where the retailer got about 77 percent of revenue last fiscal year. The maker of Uniqlo brand clothes has said it won’t slow down its China expansion, even after violent demonstrations over a territorial dispute with Japan forced it to close as many as 60 outlets temporarily in September.
“There was concern that the overseas business may not be good as people expected a consumer boycott in China after the dispute,” said Takashi Aoki, a Tokyo-based fund manager at Mizuho Asset Management Co. “It did better than I thought.”
The diplomatic spat flared up last year after Japan’s government said it would buy the islands, known as the Diaoyu in China and the Senkaku in Japanese, from their private Japanese owner.
First-quarter net income rose 24 percent to 38.5 billion yen, the company said yesterday. Overseas sales jumped 51 percent for the three months ended November, aided by expansion in China, South Korea and Taiwan. Domestic Uniqlo same-store sales rose 5 percent in in the quarter as lower temperatures boosted demand for winter clothing.
Tokyo temperatures averaged below the 30-year median on 26 of 30 days in November and 24 of 31 days in December, according to data compiled by Bloomberg.
Fast Retailing plans to open as many as 300 outlets every year, mainly in Asia. It expects to have more than 2,000 in Greater China and other Asian countries in the next 10 years, Yanai said in April. Overseas sales are expected to exceed domestic in fiscal 2015, he said.
The Japanese retailer had the highest per-share earnings on a trailing 12-month basis, almost double that of Zara seller Inditex SA, among the world’s 10 largest apparel retailers by market value, according to data compiled by Bloomberg.
Fast Retailing’s forecast in October called for sales to rise 14 percent to 1.06 trillion yen and net income to increase 18 percent to 84.5 billion yen for the year ending August.
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