Fast Retailing Co., Ltd. — Interim / Quarterly Report 2021

Jul 15, 2021

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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FAST RETAILING CO., LTD.

迅 銷 有 限 公 司

(Incorporated in Japan with limited liability)

(Stock Code:6288)

THIRD QUARTERLY RESULTS ANNOUNCEMENT

FOR THE NINE MONTHS ENDED 31 MAY 2021

AND

RESUMPTION OF TRADING

The board of directors (the “Board”) of FAST RETAILING CO., LTD. (the “Parent” or “Company”) is pleased to announce the consolidated results of the Company and its subsidiaries (collectively the “Group”) for the nine months ended 31 May 2021.

At the request of the Company, trading in its Hong Kong depositary receipts on the Stock Exchange was halted with effect from 1:00 p.m. on Thursday, 15 July 2021, pending the release of this announcement. An application will be made by the Company to the Stock Exchange for resumption of trading in the Hong Kong depositary receipts with effect from 9:00 a.m. on Friday, 16 July 2021.

(Amounts are rounded down to the nearest million yen unless otherwise stated)

1. CONSOLIDATED RESULTS

The consolidated financial results were prepared in accordance with International Financial Reporting Standards (“IFRS”).

(1) Consolidated Operating Results (1 September 2020 to 31 May 2021)

			(Percentages representyear-on-year changes)	(Percentages representyear-on-year changes)	(Percentages representyear-on-year changes)	(Percentages representyear-on-year changes)	(Percentages representyear-on-year changes)	(Percentages representyear-on-year changes)
	Revenue		Operating profit		Profit before income taxes		Profit for the period
Nine months ended 31 May 2021 Ninemonths ended 31 May2020	Millions of yen	% 9.9 (15.2)	Millions of yen 227,897 132,383	% 72.1 (46.6)	Millions of yen 245,654 142,420	%	Millions of yen	% 71.5 (47.4)
	1,698,082					72.5	156,876
	1,544,924					(42.4)	91,475
	Profit attributable to owners of the Parent		Total comprehensive income for the period		Basic earnings per share for the period		Diluted earnings per share for the period
Nine months ended 31 May 2021 Ninemonths ended 31 May2020	Millions of yen 151,351 90,640	% 67.0 (42.9)	Millions of yen 217,748 119,470	% 82.3 (26.3)	Yen 1,482.08 887.96		Yen 1,479.65 886.42

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(2) Consolidated Financial Position	(2) Consolidated Financial Position
	Total assets	Total equity	Equity attributable to owners of the Parent	Ratio of equity attributable to owners of the Parent to total assets	Equity per share attributable to owners of the Parent
As at 31 May 2021 As at 31 August2020	Millions of yen 2,492,263 2,411,990	Millions of yen 1,159,601 996,079	Millions of yen 1,113,646 956,562	% 44.7 39.7	Yen 10,903.41 9,368.83

2. DIVIDENDS

2. DIVIDENDS
(Declaration date)			Dividend per share
	First quarter period end	Second quarter period end	Third quarter period end	Year end	Total
Year ended 31 August 2020 Yearending 31 August2021	Yen - -	Yen 240.00 240.00	Yen	Yen	Yen
			-	240.00	480.00
Year ending 31 August 2021 (forecast)			-	240.00	480.00

(Note) Revisions during this quarter of dividends forecast for fiscal year: None

3. CONSOLIDATED BUSINESS RESULTS PROJECTION FOR YEAR ENDING 31 AUGUST 2021 (1 SEPTEMBER 2020 TO 31 AUGUST 2021)

			(% shows rate of increase/decrease	(% shows rate of increase/decrease	(% shows rate of increase/decrease	(% shows rate of increase/decrease	frompreviousperiod)	frompreviousperiod)
	Revenue		Operating profit		Profit before income taxes		Profit attributable to owners of the Parent
Yearending 31 August2021	Millions of yen 2,150,000	% 7.0	Millions of yen 245,000	% 64.0	Millions of yen 262,700	% 71.8	Millions of yen 165,000	% 82.6

	Basic earnings per share attributable to owners oftheParent
Yearending 31 August2021	Yen 1,616.05

(Note 1) Revisions during this quarter of previously disclosed consolidated business results projection for the year ending 31 August 2021: Yes

(Note 2) The projection of "Basic earnings per share attributable to owners of the Parent" is calculated based on the number of issued shares (excluding treasury stock) at the end of the preceding fiscal year.

－ 2 －

* Notes

* Notes	* Notes	* Notes	* Notes
(1) Changes of principal subsidiaries in the period: (2) Changes in accounting policies and changes in accounting estimates: (i) Changes in accounting policies to conform with IFRS: (ii) Other changes in accounting policies: (iii) Changes in accounting estimates: (3)Total numberof issued shares (Commonstock)					None None None None
(i)	Number of issued shares (including treasury stock)	As at 31 May 2021	106,073,656 shares	As at 31 August 2020	106,073,656 shares
(ii)	Number of treasury stock	As at 31 May 2021	3,936,239 shares	As at 31 August 2020	3,973,113 shares
(iii)	Average number of issued shares	For the nine months ended 31 May2021	102,121,062 shares	For the nine months ended 31 May2020	102,076,743 shares

• This third quarterly results announcement is not subject to quarterly review procedures pursuant to the Financial Instruments and Exchange Act of Japan.

• Explanation and other notes concerning proper use of the consolidated business results projection:

Statements made in these materials, such as those pertaining to future matters, including business projections, are based on information presently available to the Company and certain assumptions determined to be reasonable. Actual business results may vary materially depending on a variety of factors. For the background, assumptions and other matters regarding the business results projection, please refer to P.7 “(3) Qualitative Information Concerning Consolidated Business Results Projection”.

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1. Business Results

(1) Results of Operations

The Fast Retailing Group’s revenue and profit increased significantly in the first nine months of fiscal 2021 from 1 September 2020 to 31 May 2021, with consolidated revenue rising to 1.6980 trillion yen (+9.9% year-on-year) and operating profit expanding to 227.8 billion yen (+72.1% year-on-year). Group performance recovered as profitability, primarily at our UNIQLO operations, improved in the first half. In the third quarter, performance picked up at all four business segments, generating significant increases in both revenue and profit compared to the previous year when business was hit hard by the COVID-19 pandemic. We reported an impairment loss of 17.5 billion yen primarily on UNIQLO International operations, resulting in a net cost of 15.2 billion yen under other income/expenses. In addition, we recorded finance income of 17.7 billion yen on a net basis, mainly comprising a 19.5 billion yen foreign-exchange gain on foreign-currency denominated assets and other items. As a result, profit before income taxes rose to 245.6 billion yen (+72.5% year-on-year) and profit attributable to owners of the Parent rose to 151.3 billion yen (+67.0% year-on-year) in the nine months ended 31 May 2021.

The Group’s medium-term vision is to become the world’s number one apparel retailer. In pursuit of this aim, we focus our efforts on expanding UNIQLO International, as well as our GU brand and our global E-commerce operation. We continue to open multiple new UNIQLO stores in all markets and areas in which we operate and strive to instill deeper and more widespread empathy for UNIQLO’s LifeWear concept of ultimate everyday wear. Within the UNIQLO International segment, the Greater China and Southeast Asia regions are continuing to serve as the key pillars of our Group's business and growth. In terms of our GU segment, in addition to expanding the GU store network primarily in Japan, we are working to establish GU’s position as a brand that offers fun fashion at amazingly low prices. E-commerce sales continue to expand thanks to stronger initiatives to fuse online and physical stores and the offering of a wider range of services.

UNIQLO Japan

UNIQLO Japan reported large increases in revenue and profit in the first nine months of fiscal 2021, with revenue expanding to 675.1 billion yen (+12.7% year-on-year) and operating profit rising to 119.5 billion yen (+51.0% year-on-year). First-half revenue rose and profit expanded significantly on the back of strong sales of products that fulfilled customer demand for stay-at-home items as well as core Fall Winter ranges. Revenue and profit subsequently expanded significantly in the third quarter compared to a low previous-year performance.

From March to May 2021, revenue increased considerably on the back of strong sales of Uniqlo U T-shirts, KANDO pants and other Summer ranges along with loungewear, ultra stretch active pants, and other items. E-commerce revenue increased as the online sales operation continued to expand favorably. Since 12 March 2021, we have changed the product price displays in Japan to show just one tax-inclusive price to make our products easier for customers to purchase. However, the prices have remained the same following our decision to absorb the additional consumption-tax component ourselves. To alleviate the impact of this move on our gross profit margin, we have worked hard to reduce the cost of sales. As a result, we were able to contain the decline in UNIQLO Japan’s third-quarter gross profit margin to 0.5 point year-on-year. In addition, the third-quarter selling, general and administrative expense ratio improved by 6.1 points year-on-year. However, overall sales struggled in the face of a higher-thananticipated COVID-19 impact and our inability to fully convey the new, newsworthy elements of our products to customers, so the third-quarter UNIQLO Japan performance did fall short of our business plan.

UNIQLO International

UNIQLO International reported a rise in revenue and a large increase in profit in the first nine months of fiscal 2021, with revenue rising to 739.6 billion yen (+9.8% year-on-year) and operating profit increasing to 97.7 billion yen (+88.7% year-onyear). Profit increased significantly in the first half thanks to improved profitability in East Asia operations. All regions reported significant recoveries in the third quarter. Geographically speaking, the Mainland China market reported large rises in both revenue and profit. UNIQLO South Korea moved back into the black in terms of operating profit following improvements in the operation’s gross profit margin and selling, general and administrative expense ratio. UNIQLO South Asia, Southeast Asia & Oceania (Southeast Asia, Australia, and India) reported a large rise in revenue and a return to the black in terms of operating profit. UNIQLO North America and UNIQLO Europe reported large revenue gains and smaller operating losses as the COVID situation improved in those regions.

From March to May 2021, performance from the Greater China region fell short of our business estimates. For the Mainland China market, compared with the extremely strong May Labor Day sales in 2020, when a rebound in consumption was observed after the pandemic was brought under control, demand across the whole retail market was slightly more subdued as consumer

focus shifted to domestic travel this year. However, UNIQLO International third-quarter operating profit came in roughly in line with plan thanks to larger-than-expected improvements in profitability in North America and Europe.

GU

Our GU operation reported a rise in revenue and a large increase in profit in the nine months ended May 2021, with revenue climbing to 200.8 billion yen (+7.1% year-on-year) and operating profit expanding to 24.3 billion yen (+18.9% year-on-year). GU performance held steady year-on-year but both revenue and profit increased considerably in the third quarter.

From March to May 2021, items such as chef’s pants, airy shirts, and colored flared slacks contributed to the rise in GU revenue. However, sales struggled and GU performance fell short of our business estimates due to the announcement of another state of emergency in Japan and the fact that some of our GU products did not fully grasp the prevailing trend.

Global Brands

Global Brands revenue declined and operating losses widened in the first nine months of fiscal 2021. Revenue declined to 80.5 billion yen (-3.3% year-on-year) and the segment reported an operating loss of 8.9 billion yen (compared to an operating loss of 6.0 billion in the first nine months of fiscal 2020). In the first half, Global Brands performance worsened significantly in the wake of COVID-19, but performance, primarily driven by Theory, picked up in the third quarter, with revenue rising sharply and the operating loss shrinking to 0.7 billion yen (compared to an operating loss of 6.7 billion in the third quarter of fiscal 2020). However, Global Brands performance fell short of plan due to a higher-than-anticipated COVID-19 impact.

Sustainability

In keeping with our key sustainability message, “Unlocking the power of clothing,” the Group pursues sustainability activities through our core clothing business focused on six clear material areas: Creating new value through products and services; Respecting human rights in our supply chain; Respecting the environment; Strengthening communities; Supporting employee fulfillment; Implementing good corporate governance. Our main activities in the third quarter of fiscal 2021 from March 2021 to May 2021 involved:

■Consideration for the environment: In June 2021, we expressed our support for proposals by the Task Force on Climate-related Financial Disclosures (TCFD) targeting disclosure of companies' actions in relation to climate change, and are working toward disclosing such information in accordance with the TCFD. The Sustainability Committee is also advancing discussions on the establishment of long-term reduction targets and specific measures to counter greenhouse gas emissions in the supply chain, including from our own stores and offices, the factories of business partners, and the production of raw materials.

■Community support: In support of efforts against the COVID-19 pandemic, we have been donating masks and isolation gowns to medical institutions and nursing care facilities around the world since last year. In India, where the impact of COVID-19 is spreading, we have provided emergency support equivalent to 220 million rupees (approximately 330 million yen), including over 600,000 Uniqlo AIRism Masks.

■Employee satisfaction: We have established various personnel systems that enable all employees to choose work styles that are right for their stage of life, helping them build careers and exhibit their respective individualities and talents. Among these, we are promoting career development for female employees. For example, we provide a development program for female management candidates, along with training aimed at dispelling unconscious bias toward female management and management candidates. Moving forward, the Diversity Promotion Team will play a central role in efforts to improve the percentage of women in management roles by analyzing and monitoring the ratio of male to female promotions by country and department.

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• (2) Financial Positions and Cash Flows Information

• (i) Financial Positions

Total assets as at 31 May 2021 were 2.4922 trillion yen, which was an increase of 80.2 billion yen relative to the end of the preceding fiscal year. The principal factors were an increase of 83.6 billion yen in cash and cash equivalents, an increase of 8.9 billion yen in trade and other receivables, an increase of 12.8 billion yen in other current financial assets, a decrease of 72.8 billion yen in inventories, an increase of 26.8 billion yen in derivative financial assets, an increase of 25.7 billion yen in property, plant and equipment, and a decrease of 9.9 billion yen in deferred tax assets.

Total liabilities as at 31 May 2021 were 1.3326 trillion yen, which was a decrease of 83.2 billion yen relative to the end of the preceding fiscal year. The principal factors were a decrease of 31.7 billion yen in trade and other payables, a decrease of 93.9 billion yen in other current financial liabilities, an increase of 4.5 billion yen in lease liabilities, an increase of 21.3 billion yen in current tax liabilities, an increase of 6.2 billion yen in other current liabilities, an increase of 5.1 billion yen in provisions, and an increase of 4.6 billion yen in deferred tax liabilities.

Total net assets as at 31 May 2021 were 1.1596 trillion yen, which was an increase of 163.5 billion yen relative to the end of the preceding fiscal year. The principal factors were an increase of 102.7 billion yen in retained earnings, and an increase of 52.2 billion yen in other components of equity.

(ii) Cash Flows Information

Cash and cash equivalents as at 31 May 2021 had increased by 83.6 billion yen from the end of the preceding fiscal year, to 1.1771 trillion yen.

(Operating Cash Flows)

Net cash generated by operating activities for the nine months ended 31 May 2021 was 367.2 billion yen, which was an increase of 194.0 billion yen (+112.1% year-on-year) from the nine months ended 31 May 2020. The principal factors were 245.6 billion yen in profit before income taxes (an increase of 103.2 billion yen from the nine months ended 31 May 2020), 19.5 billion yen in foreign exchange gains (a decrease of 11.8 billion yen from the nine months ended 31 May 2020), a decrease of 87.4 billion yen in inventories (an increase of 56.1 billion yen from the nine months ended 31 May 2020), and an increase of 6.5 billion yen in other liabilities (an increase of 42.7 billion yen from the nine months ended 31 May 2020).

(Investing Cash Flows)

Net cash used in investing activities for the nine months ended 31 May 2021 was 65.7 billion yen, which was a decrease of 4.3 billion yen (-6.2% year-on-year) from the nine months ended 31 May 2020. The principal factors were a net increase of 6.8 billion yen in bank deposits with original maturities of three months or longer (a decrease of 7.8 billion yen from the nine months ended 31 May 2020), 41.9 billion yen in payments for property, plant and equipment (an increase of 5.9 billion yen from the nine months ended 31 May 2020), 13.8 billion yen in payments for intangible assets (a decrease of 2.6 billion yen from the nine months ended 31 May 2020), 0.8 billion yen in payments for acquisition of right-of-use (a decrease of 0.5 billion yen from the nine months ended 31 May 2020), 4.2 billion yen in payments for acquisition of investments in associates (an increase of 4.2 billion yen from the nine months ended 31 May 2020), and 1.6 billion yen in proceeds from other investing activities (a decrease of 3.3 billion yen from the nine months ended 31 May 2020).

(Financing Cash Flows)

Net cash used in financing activities for the nine months ended 31 May 2021 was 262.7 billion yen, which was an increase of 113.2 billion yen (+75.8% year-on-year) from the nine months ended 31 May 2020. The principal factors were a net decrease of 0.4 billion yen in loans payable (an increase of 5.4 billion yen from the nine months ended 31 May 2020), 100.0 billion yen in repayment of redemption of bonds (an increase of 100.0 billion yen from the nine months ended 31 May 2020), 1.8 billion yen in dividends paid to non-controlling interests (a decrease of 0.4 billion yen from the nine months ended 31 May 2020), and 111.6 billion yen in repayments of lease liabilities (an increase of 8.2 billion yen from the nine months ended 31 May 2020).

－ 6 －

(3) Qualitative Information Concerning Consolidated Business Results Projection

The following adjustments were made concerning the consolidated business results projection for the year ending 31 August 2021 in consideration of the business results for the nine months ended 31 May 2021.

In addition, below are the differences of the consolidated business results projections for the year ending 31 August 2021 as reported in the “Interim Results Announcement For The Six Months Ended 28 February 2021 And Resumption Of Trading” released on 8 April 2021.

					(Full financial year)
	Revenue	Operating profit	Profit before income taxes	Profit attributable to owners of the Parent	Basic earnings per share attributable to owners of the Parent
Previous forecast (A) New forecast (B) Difference (B–A) Change (%) Previous results	Millions of yen 2,210,000 2,150,000 (60,000) (2.7) 2,008,846	Millions of yen 255,000 245,000 (10,000) (3.9) 149,347	Millions of yen 255,000 262,700 7,700 3.0 152,868	Millions of yen 165,000 165,000 - - 90,357	Yen 1,616.05 1,616.05 - - 885.15

(Note) The projection of "Basic earnings per share attributable to owners of the Parent" is calculated based on the number of issued shares (excluding treasury stock) at the end of the preceding fiscal year.

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2. Interim Condensed Consolidated Financial Statements and Accompanying Material Notes

(1) Interim Condensed Consolidated Statement of Financial Position

(1) Interim Condensed Consolidated Statement of Financial Position
	(Millions of yen)
Notes	As at 31 August 2020 As at 31 May 2021
ASSETS Current assets Cash and cash equivalents Trade and other receivables Other financial assets Inventories Derivative financial assets Income taxes receivable Other assets Total current assets Non-current assets Property, plant and equipment 6 Right-of-use assets 6 Goodwill Intangible assets 6 Financial assets Investments in associates accounted for using the equity method Deferred tax assets Derivative financial assets Other assets 6 Total non-current assets Total assets Liabilities and equity LIABILITIES Current liabilities Trade and other payables Other financial liabilities Derivative financial liabilities Lease liabilities Current tax liabilities Provisions Other liabilities Total current liabilities Non-current liabilities Financial liabilities Lease liabilities Provisions Deferred tax liabilities Derivative financial liabilities Other liabilities Total non-current liabilities Total liabilities EQUITY Capital stock Capital surplus Retained earnings Treasury stock, at cost Other components of equity Equity attributable to owners of the Parent Non-controlling interests Total equity Total liabilities and equity	1,093,531 1,177,159 67,069 76,025 49,890 62,712 417,529 344,651 14,413 24,691 2,126 1,310 10,629 15,586
	1,655,191 1,702,138 136,123 161,918 399,944 395,415 8,092 8,092 66,833 67,923 67,770 68,492 14,221 18,289 45,447 35,530 10,983 27,538 7,383 6,923
	756,799 790,125
	2,411,990 2,492,263
	210,747 178,994 213,301 119,346 2,763 5,334 114,652 120,451 22,602 43,978 752 1,079 82,636 88,902
	647,455 558,086 370,780 370,806 351,526 350,316 32,658 37,493 7,760 12,410 3,205 1,140 2,524 2,408
	768,455 774,575
	1,415,910 1,332,661 10,273 10,273 23,365 25,301 933,303 1,036,072 (15,129) (14,994) 4,749 56,991
	956,562 1,113,646 39,516 45,955
	996,079 1,159,601
	2,411,990 2,492,263

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(2) Interim Condensed Consolidated Statement of Profit or Loss and Interim Condensed Consolidated Statement of Comprehensive Income

Interim Condensed Consolidated Statement of Profit or Loss

(Millions of yen)

Notes	Nine months ended 31 May 2020 Nine months ended 31 May 2021
Revenue 2 Cost of sales Gross profit Selling, general and administrative expenses 3 Other income 4 Other expenses 4,6 Share of profit and loss of associates accounted for using the equity method Operating profit Finance income 5 Finance costs 5 Profit before income taxes Income tax expense Profit for the period Profit for the period attributable to: Owners of the Parent Non-controlling interests Total Earnings per share Basic (yen) 7 Diluted (yen) 7 Interim Condensed Consolidated Statement of Comprehensive Income	1,544,924 1,698,082 (793,637) (839,246)
	751,286 858,836 (608,029) (615,730) 7,098 7,855 (18,425) (23,646) 453 581
	132,383 227,897 15,938 23,014 (5,901) (5,256)
	142,420 245,654 (50,944) (88,777)
	91,475 156,876
	90,640 151,351 835 5,525
	91,475 156,876
	887.96 1,482.08 886.42 1,479.65 (Millions of yen)

Interim Condensed Consolidated Statement of Comprehensive Income	(Millions of yen)
	Nine months ended Nine months ended
	31 May 2020 31 May 2021
Profit for the period Other comprehensive income / (loss), net of income tax Items that will not be reclassified subsequently to profit or loss Financial assets measured at fair value through other comprehensive income / (loss) Total items that will not be reclassified subsequently to profit or loss Items that may be reclassified subsequently to profit or loss Exchange differences on translating foreign operations Cash flow hedges Share of other comprehensive income / (loss) of associates Total items that may be reclassified subsequently to profit or loss Other comprehensive income / (loss), net of income tax Total comprehensive income for the period Attributable to: Owners of the Parent Non-controlling interests Total comprehensive income for the period	91,475 156,876 (244) 410
	(244) 410 1,084 36,225 27,165 24,136 (10) 98
	28,239 60,460
	27,994 60,871
	119,470 217,748
	119,501 209,635 (31) 8,112
	119,470 217,748

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(3) Interim Condensed Consolidated Statement of Changes in Equity

For the nine months ended 31 May 2020

(Millions of yen)

Notes	Capital stock Capital surplus Retained earnings Treasury stock, at cost	Other components of equity Equity attributable to owners of the Parent Non- controlling interest Total equity Financial assets measured at fair value through other comprehensive income Foreign currency translation reserve Cash flow hedge reserve Share of other comprehensive income of associates Total
As at 1 September 2019 Effect of change in accounting policy Balance after adjustment Net changes during the period Comprehensive income Profit for the period Other comprehensive income / (loss) Total comprehensive income / (loss) Transactions with the owners of the Parent Acquisition of treasury stock Disposal of treasury stock Dividends Share-based payments Transfer to non-financial assets Total transactions with the owners of the Parent Total net changes during the period As at 31 May 2020	10,273 20,603 928,748 (15,271) (697) (13,929) 8,906 (11) (5,732) 938,621 44,913 983,534
	- - (34,252) - - - - - - (34,252) (1,361) (35,614)
	10,273 20,603 894,495 (15,271) (697) (13,929) 8,906 (11) (5,732) 904,368 43,551 947,920
	- - 90,640 - - - - - - 90,640 835 91,475 - - - - (244) 1,911 27,204 (10) 28,860 28,860 (866) 27,994
	- - 90,640 - (244) 1,911 27,204 (10) 28,860 119,501 (31) 119,470 - - - (5) - - - - - (5) - (5) - 1,261 - 121 - - - - - 1,382 - 1,382 - - (48,994) - - - - - - (48,994) (1,565) (50,560) - 1,424 - - - - - - - 1,424 - 1,424 - - - - - - (9,060) - (9,060) (9,060) (974) (10,035)
	- 2,685 (48,994) 116 - - (9,060) - (9,060) (55,253) (2,540) (57,793)
	- 2,685 41,645 116 (244) 1,911 18,143 (10) 19,800 64,248 (2,572) 61,676
	10,273 23,288 936,141 (15,155) (942) (12,018) 27,050 (21) 14,068 968,616 40,979 1,009,596

For the nine months ended 31 May 2021

(Millions of yen)

Notes	Capital stock Capital surplus Retained earnings Treasury stock, at cost	Other components of equity Equity attributable to owners of the Parent Non- controlling interests Total equity Financial assets measured at fair value through other comprehensive income Foreign currency translation reserve Cash flow hedge reserve Share of other comprehensive income of associates Total
As at 1 September 2020 Net changes during the period Comprehensive income Profit for the period Other comprehensive income / (loss) Total comprehensive income / (loss) Transactions with the owners of the Parent Acquisition of treasury stock Disposal of treasury stock Dividends Share-based payments Transfer to non-financial assets Transfer to retained earnings Others Total transactions with the owners of the Parent Total net changes during the period As at 31 May 2021	10,273 23,365 933,303 (15,129) 385 (8,489) 12,905 (51) 4,749 956,562 39,516 996,079 - - 151,351 - - - - - - 151,351 5,525 156,876 - - - - 410 32,940 24,834 98 58,284 58,284 2,587 60,871
	- - 151,351 - 410 32,940 24,834 98 58,284 209,635 8,112 217,748 - - - (5) - - - - - (5) - (5) - 1,567 - 140 - - - - - 1,708 - 1,708 - - (49,015) - - - - - - (49,015) (1,867) (50,882) - 369 - - - - - - - 369 - 369 - - - - - - (5,608) - (5,608) (5,608) (68) (5,677) - - 433 - (433) - - - (433) - - - - - - - - - - - - - 262 262
	- 1,936 (48,582) 134 (433) - (5,608) - (6,041) (52,552) (1,673) (54,226)
	- 1,936 102,769 134 (22) 32,940 19,225 98 52,242 157,083 6,438 163,521
	10,273 25,301 1,036,072 (14,994) 363 24,450 32,130 46 56,991 1,113,646 45,955 1,159,601

－ 10 －

(4) Interim Condensed Consolidated Statement of Cash Flows

(Millions of yen)

(4) Interim Condensed Consolidated Statement of Cash Flows	(Millions of yen)
Notes	Nine months ended Nine months ended
	31 May 2020 31 May 2021
Cash flows from operating activities Profit before income taxes Depreciation and amortization Impairment losses 6 Interest and dividend income Interest expenses Foreign exchange losses / (gains) Share of profit and loss of associates accounted for using the equity method Losses on disposal of property, plant and equipment (Increase) / Decrease in trade and other receivables (Increase) / Decrease in inventories Increase / (Decrease) in trade and other payables (Increase) / Decrease in other assets Increase / (Decrease) in other liabilities Others, net Cash generated from operations Interest and dividends income received Interest paid Income taxes paid Income taxes refunded Net cash generated by operating activities Cash flows from investing activities Amounts deposited into bank deposits with original maturities of three months or longer Amounts withdrawn from bank deposits with original maturities of three months or longer Payments for property, plant and equipment Payments for intangible assets Payments for acquisition of right-of-use assets Payments for lease and guarantee deposits Proceeds from collection of lease and guarantee deposits Payments for acquisition of investments in associates Others, net Net cash generated by / (used in) investing activities	142,420 245,654 131,157 132,576 15,296 17,577 (8,286) (3,473) 5,901 5,249 (7,651) (19,532) (453) (581) 712 757 (14,999) (7,826) 31,327 87,475 (39,409) (39,652) 4,090 1,463 (36,243) 6,517 5,629 2,346
	229,492 428,549 7,866 3,110 (4,776) (4,336) (60,287) (61,928) 827 1,818
	173,122 367,214
	(67,776) (78,518) 53,079 71,683 (35,974) (41,952) (16,504) (13,815) (1,366) (807) (4,723) (2,859) 4,882 3,129 - (4,232) (1,715) 1,605
	(70,097) (65,768)

－ 11 －

	(Millions of yen)
	Nine months ended Nine months ended
	31 May 2020 31 May 2021
Cash flows from financing activities Proceeds from short-term loans payable Repayment of short-term loans payable Repayment of long-term loans payable Repayment of redemption of bonds Dividends paid to owners of the Parent Dividends paid to non-controlling interests Repayments of lease liabilities Others, net Net cash generated by / (used in) financing activities Effect of exchange rate changes on the balance of cash held in foreign currencies Net increase / (decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of period Cash and cash equivalents at the end of period	10,319 43,425 (931) (43,843) (4,343) - - (100,000) (48,965) (48,993) (2,328) (1,867) (103,358) (111,638) 116 134
	(149,492) (262,782)
	5,681 44,965
	(40,785) 83,627 1,086,519 1,093,531
	1,045,734 1,177,159

－ 12 －

• (5) Notes to assumption of going concern

Not applicable.

－ 13 －

(6) Notes to the Interim Condensed Consolidated Financial Statements

1. Segment Information

(i) Description of reportable segments

The Group’s reportable segments are components for which discrete financial information is available and which are reviewed regularly by the Board of Directors (the “Board”) to make decisions about the allocation of resources and to assess performance.

The Group’s main retail clothing business is divided into four reportable operating segments: UNIQLO Japan, UNIQLO International, GU and Global Brands, each of which is used to frame and form the Group’s strategy.

The main businesses covered by each reportable segment are as follows:

UNIQLO Japan: UNIQLO clothing business within Japan

UNIQLO International: UNIQLO clothing business outside of Japan GU: GU clothing business in Japan and overseas

Global Brands: Theory, PLST, COMPTOIR DES COTONNIERS, PRINCESSE TAM.TAM and J Brand clothing business

(ii) Segment revenue and results

For the nine months ended 31 May 2020

							(Millions of yen)	(Millions of yen)
		Reportable segments			Total	Others (Note 1)	Adjustments (Note 2)	Interim Condensed Consolidated Statement of Profit or Loss
	UNIQLO Japan	UNIQLO International	GU	Global Brands
Revenue	598,843	673,532	187,488	83,344	1,543,208	1,715	-	1,544,924
Operating profit / (loss)	79,160	51,815	20,486	(6,002)	145,458	401	(13,476)	132,383
Segment income /(loss) (i.e., profit / loss before income taxes)	80,732	53,121	20,340	(6,361)	147,833	402	(5,814)	142,420
Other disclosure: Impairment losses (Note 3)	2,776	11,328	436	755	15,296	-	-	15,296

(Note 1) “Others” includes the real estate leasing business, etc.

(Note 2) “Adjustments” mainly includes revenue and corporate expenses which are not allocated to individual reportable segments. (Note 3) Details on the Impairment losses are stated in note “6. Impairment losses”.

For the nine months ended 31 May 2021

							(Millions of yen)	(Millions of yen)
		Reportable	segments		Total	Others (Note 1)	Adjustments (Note 2)	Interim Condensed Consolidated Statement of Profit or Loss
	UNIQLO Japan	UNIQLO International	GU	Global Brands
Revenue	675,102	739,609	200,858	80,576	1,696,146	1,936	-	1,698,082
Operating profit / (loss)	119,518	97,781	24,353	(8,983)	232,670	110	(4,883)	227,897
Segment income /(loss) (i.e., profit / loss before income taxes)	121,920	96,412	24,300	(9,343)	233,290	111	12,253	245,654
Other disclosure: Impairment losses (Note 3)	3,155	11,103	1,095	2,222	17,577	-	-	17,577

(Note 1) “Others” includes the real estate leasing business, etc.

(Note 2) “Adjustments” mainly includes revenue and corporate expenses which are not allocated to individual reportable segments.

(Note 3) Details on the Impairment losses are stated in note “6. Impairment losses”.

－ 14 －

2. Revenue

The Group conducts its global clothing retail operations through both physical stores and e-commerce channels. The following is a breakdown of total revenue by major regional market operation.

		Nine months ended 31 May 2020	Nine months ended 31 May 2020	Nine months ended 31 May 2020
		Revenue (Millions of yen)	Percent of Total (%)
	Japan Greater China Other parts of Asia & Oceania North America & Europe	598,843 362,657 160,128 150,746	38.8 23.5 10.4 9.8
UNIQLO (Note 1)		1,272,375	82.4
GU (Note 2)		187,488	12.1
Global Brands (Note 3)		83,344	5.4
Others (Note 4)		1,715	0.1
Total		1,544,924	100.0

(Note 1) Revenue is classified by nation or region based on customer location.

The designated countries and regions are classified as follows:

Greater China: Mainland China, Hong Kong, Taiwan

Other parts of Asia & Oceania: South Korea, Singapore, Malaysia, Thailand, the Philippines, Indonesia, Australia, Vietnam, India

North America & Europe: United States of America, Canada, United Kingdom, France, Russia, Germany, Belgium, Spain, Sweden, the Netherlands, Denmark, Italy

(Note 2) Main national and regional market: Japan

(Note 3) Main national and regional markets: North America, Europe, Japan

(Note 4) The “Others” category includes real estate leasing operations.

－ 15 －

Nine months ended 31 May 2021

		Revenue (Millions of yen)	Percent of Total (%)
	Japan Greater China Other parts of Asia & Oceania North America & Europe	675,102 431,502 165,255 142,851	39.8 25.4 9.7 8.4
UNIQLO (Note 1)		1,414,711	83.3
GU (Note 2)		200,858	11.8
Global Brands (Note 3)		80,576	4.7
Others (Note 4)		1,936	0.1
Total		1,698,082	100.0

(Note 1) Revenue is classified by nation or region based on customer location.

The designated countries and regions are classified as follows:

Greater China: Mainland China, Hong Kong, Taiwan

Other parts of Asia & Oceania: South Korea, Singapore, Malaysia, Thailand, the Philippines, Indonesia, Australia, Vietnam, India

North America & Europe: United States of America, Canada, United Kingdom, France, Russia, Germany, Belgium, Spain, Sweden, the Netherlands, Denmark, Italy

(Note 2) Main national and regional market: Japan

(Note 3) Main national and regional markets: North America, Europe, Japan

(Note 4) The “Others” category includes real estate leasing operations.

3. Selling, general and administrative expenses

The breakdown of selling, general and administrative expenses for each reporting period is as follows:

		(Millions of yen)
	Nine months ended 31 May 2020	Nine months ended 31 May 2021
Selling, general and administrative expenses Advertising and promotion Lease expenses Depreciation and amortization Outsourcing Salaries Distribution Others	53,069 43,009 131,157 36,785 207,768 75,318 60,920	51,603 49,857 132,576 37,458 210,503 71,543 62,186
Total	608,029	615,730

－ 16 －

4. Other income and other expenses

The breakdown of Other income and Other expenses for each reporting period is as follows:

		(Millions of yen)
	Nine months ended 31 May 2020	Nine months ended 31 May 2021
Other income Foreign exchange gains (Note) Others	1,841 5,256	4,201 3,653
Total	7,098	7,855

(Millions of yen)

		(Millions of yen)
	Nine months ended 31 May 2020	Nine months ended 31 May 2021
Other expenses Loss on retirement of property, plant and equipment Impairment losses Others	712 15,296 2,416	757 17,577 5,310
Total	18,425	23,646

(Note) Currency adjustments incurred in the course of operating transactions are included in “Other income”.

5. Finance income and finance costs

The breakdown of Finance income and Finance costs for each reporting period is as follows:

(Millions of yen)

		(Millions of yen)
	Nine months ended 31 May 2020	Nine months ended 31 May 2021
Finance income Foreign exchange gains (Note) Interest income Others	7,651 8,271 14	19,532 3,461 20
Total	15,938	23,014

(Millions of yen)

		(Millions of yen)
	Nine months ended 31 May 2020	Nine months ended 31 May 2021
Finance costs Interest expenses Others	5,901 -	5,249 7
Total	5,901	5,256

(Note) Currency adjustments incurred in the course of non-operating transactions are included in “Finance income”.

－ 17 －

6. Impairment losses

During the nine months ended 31 May 2021, the Group recognized impairment losses on certain store assets etc., due to reductions in originally expected profitability of the respective cash-generating unit (“CGU”). The breakdown of impairment losses by asset type is as follows:

		(Millions ofyen)
	Nine months ended 31 May 2020	Nine months ended 31 May 2021
Buildings and structures Furniture, equipment and vehicles	3,053 507	1,495 374
Subtotal on property, plant and equipment	3,561	1,869
Software Other intangible assets	0 -	108 7
Subtotal on intangible assets	0	116
Right-of-use assets Other non-current assets (long-term prepayments)	11,732 2	15,588 2
Total impairment losses	15,296	17,577

The Group’s impairment losses during the nine months ended 31 May 2021 amounted to 17,577 million yen, compared with 15,296 million yen during the nine months ended 31 May 2020, and are included in “Other expenses” on the Interim condensed consolidated statement of profit or loss.

For the nine months ended 31 May 2020

Property, plant and equipment and Right-of-use assets Impairment losses amounting to 15,296 million yen represented write downs of the carrying amounts of store assets to the recoverable amounts, primarily due to a reduction in profitability of certain stores, including flagship stores. With the global spread of COVID-19, the Group's performance has been adversely affected due to temporarily closing stores, etc. We measured impairment losses on the assumption that the impact of the COVID-19 pandemic will continue to be felt through to the end of August 2021.

The grouping of assets is based on the smallest CGU that independently generates cash inflow. In principle, each store, including flagship stores, is considered as an individual CGU and recoverable amounts thereon are calculated based on value in use.

The value in use is calculated based on the cash flow projections with estimates and growth rates compiled by management at a discount rate of mainly 6.3%. Theoretically, the projected cash flows cover a five-year period, and do not use a growth rate that exceeds the long-term average market growth rate. The pre-tax discount rate calculation is based on the weighted-average cost of capital.

The main CGUs for which impairment losses were recorded are as follows:

	Operating segment	CGU	Type
	UNIQLO Japan	UNIQLO CO., LTD. stores	Buildings and structures and Right-of- use assets etc.
	UNIQLO International	UNIQLO USA, FRL Korea Co., Ltd. etc., stores	Buildings and structures and Right-of- use assets etc.
	GU	FRL Korea Co., Ltd. etc., stores	Buildings and structures and Right-of- use assets etc.
	Global Brands	Theory LLC., etc., stores	Buildings and structures and Right-of- use assets etc.

－ 18 －

For the nine months ended 31 May 2021 Property, plant and equipment and Right-of-use assets

Impairment losses amounting to 17,577 million yen represented write downs of the carrying amounts of store assets to the recoverable amounts, primarily due to a reduction in profitability of certain stores, including flagship stores. With the global spread of COVID-19, the Group's performance has been adversely affected due to temporarily closing stores, etc. Although the timing for the situation subsiding differs from region to region and on a case-by-case basis, we made accounting estimates involving the assumption that the impact will last until the end of February 2022 for most countries and regions including Japan. For stores in other certain countries and regions, it may take longer for the situation to get under control.

The grouping of assets is based on the smallest CGU that independently generates cash inflow. In principle, each store, including flagship stores, is considered as an individual CGU and recoverable amounts thereon are calculated based on value in use.

The value in use is calculated by discounting the cash flow projections based on estimates and growth rates approved by management at a discount rate of mainly 8.7%. Theoretically, the projected cash flows cover a maximum period of five years, and do not use a growth rate that exceeds the long-term average market growth rate. The pre-tax discount rate calculation is primarily based on the weighted-average cost of capital.

The main CGUs for which impairment losses were recorded are as follows:

Operating segment	CGU	Type
UNIQLO Japan	UNIQLO CO., LTD. stores	Buildings and structures and Right-of- use assets etc.
UNIQLO International	UNIQLO USA LLC, UNIQLO EUROPE LIMITEDetc., stores	Buildings and structures and Right-of- use assets etc.
GU	G.U. CO., LTD. etc., stores	Buildings and structures and Right-of- use assets etc.
Global Brands	COMPTOIR DES COTONNIERS S.A.S., etc., stores	Buildings and structures and Right-of- use assets etc.

－ 19 －

7. Earnings per share

7. Earnings per share	7. Earnings per share
Nine months ended 31 May 2020		Nine months ended 31 May 2021
Equity per share attributable to owners of the Parent (Yen) Basic earnings per share (Yen) Diluted earnings per share (Yen)	9,487.54 887.96 886.42	Equity per share attributable to owners of the Parent (Yen) Basic earnings per share (Yen) Diluted earnings per share (Yen)			10,903.41 1,482.08 1,479.65
(Note) The basis for calculation of basic earnings per share and diluted earnings per share is as follows:
			Nine months ended 31 May 2020	Nine months ended 31 May 2021
Basic earnings per share for the period Profit for the period attributable to owners of the Parent (Millions of yen) Profit not attributable to common shareholders (Millions of yen) Profit attributable to common shareholders (Millions of yen) Average number of common stock outstanding during the period (Shares) Diluted earnings per share for the period Adjustment to profit (Millions of yen) Increase in number of common stock (Shares) (Number of share subscription rights included in increase)			90,640 - 90,640 102,076,743 - 178,269 (178,269)	151,351 - 151,351 102,121,062 - 167,579 (167,579)

8. Subsequent events

Not applicable.

－ 20 －

3. Resumption of Trading

At the request of the Company, trading in its Hong Kong depositary receipts on the Stock Exchange was halted with effect from 1:00 p.m. on Thursday, 15 July 2021, pending the release of this announcement. An application will be made by the Company to the Stock Exchange for resumption of trading in the Hong Kong depositary receipts with effect from 9:00 a.m. on Friday, 16 July 2021.

On behalf of the Board FAST RETAILING CO., LTD. Tadashi Yanai Chairman, President and Chief Executive Officer

Japan, 15 July 2021

As at the date of this announcement, the Executive Director is Tadashi Yanai, the Non-executive Directors are Takeshi Okazaki, Kazumi Yanai and Koji Yanai, the Independent Non-executive Directors are Toru Hambayashi, Nobumichi Hattori, Masaaki Shintaku, Takashi Nawa and Naotake Ohno.

－ 21 －