FAST RETAILING CO., LTD.
迅 銷 有 限 公 司Year-end Report 2020/21
2020.9.1–2021.8.31
Stock Code: 6288

Contents
1. Corporate Information

1

2. Financial Highlights

2

3. Corporate Profile

4

4. Management Discussion and Analysis

12

5. Capital Expenditures30

6. Stock Information and Dividend Policy

33

7. Corporate Governance Report52

8. Board of Directors

61

9. Financial Information

80

Consolidated Financial Statements

81(1) Consolidated statement of financial position

81(2) Consolidated statement of profit or loss

83(3) Consolidated statement of comprehensive income

84(4) Consolidated statement of changes in equity

85(5) Consolidated statement of cash flows

87(6) Notes to the consolidated financial statements

89

Non-Consolidated Financial Statements

158(1) Balance sheet

158(2) Statement of income

160(3) Statement of changes in net assets

161(4) Notes

163(5) Supplementary schedule

167(6) Main details of assets and liabilities

168(7) Others

168

Independent Auditor’s Report (Group)169

Independent Auditor’s Report (Company)

174

Internal Control Report

177

Confirmation Note178

1. Corporate Information
Board of Directors
Representative Director

Principal Place of Business in Japan
Midtown Tower 9-7-1

Tadashi Yanai (Chairman, President and CEO)Akasaka, Minato-ku
Tokyo 107-6231
Japan

Directors
Takeshi Okazaki
Kazumi Yanai

Principal Place of Business in Hong Kong
702–706, 7th Floor, Mira Place Tower A

Koji Yanai

No. 132 Nathan Road
Tsim Sha Tsui

External Directors
Toru Hambayashi (retiring in the year ending 31 August 2022)

KowloonHong Kong

Nobumichi Hattori
Masaaki Shintaku

HDR Registrar and HDR Transfer Office

Takashi Nawa
Naotake Ono

Computershare Hong Kong Investor Services Limited
Shops 1712–1716, 17th Floor

Kathy Matsui

Hopewell Centre
183 Queen’s Road East

Board of Statutory Auditors
Akira Tanaka (retiring in the year ending 31 August 2022)

WanchaiHong Kong

Masaaki Shinjo
Masumi Mizusawa

Stock Code

Keiko Kaneko (External)
Takao Kashitani (External)

Hong Kong: 6288
Japan: 9983

Masakatsu Mori (External)
Website AddressCompany Secretary
Shea Yee Man

http://www.fastretailing.com

Independent Auditor
Deloitte Touche Tohmatsu LLC
Principal Banks
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
The Hong Kong and Shanghai Banking Corporation Limited
Registered Office and Headquarters
10717-1 Sayama
Yamaguchi City
Yamaguchi 754-0894
Japan

－

1 －

2. Financial Highlights
A. Consolidated Financial Summary
International Financial Reporting Standards (“IFRS”)

Term
56th Year

57th Year

58th Year

59th Year

60th Year

Year ended
31 August
2017

Year ended
31 August
2018

Year ended
31 August
2019

Year ended
31 August2020

Year ended
31 August
2021

1,861,917

2,130,060

2,290,548

2,008,846

2,132,992

Operating profit (Millions of yen)

176,414236,212257,636

149,347

249,011

Profit before income taxes (Millions ofyen)

193,398

242,678

252,447

152,868

265,872

119,280

154,811

162,578

90,357

169,847

190,566

165,378

140,900

110,134

215,309731,770

862,936

938,621956,562

1,116,484

Total assets (Millions of yen)

1,388,486

1,953,466

2,010,558

2,411,990

2,509,976

Equity per share attributable to ownersof the Parent (Yen)7,175.35

8,458.52

9,196.61

9,368.83

10,930.42

1,169.70

1,517.71

1,593.20

885.15

1,663.12

1,168.00

1,515.23

1,590.55

883.62

1,660.44

Ratio of equity attributable to ownersof the Parent to total assets (%)

52.7

44.2

46.7

39.7

44.5

Ratio of profit to equity attributable toowners of the Parent (%)

18.3

19.4

18.0

9.5

16.4

Price earnings ratio (times)

26.9

34.1

39.1

71.5

43.6

212,168

176,403

300,505

264,868

428,968

122,790(57,180)(78,756)(75,981)(82,597)(50,836)

198,217(102,429)(183,268)(302,985)

Cash and cash equivalents at end ofyear (Millions of yen)

683,802

999,697

1,086,519

1,093,531

1,177,736

Number of employees:

44,424

52,83956,52357,72755,589(31,719)(71,840)(80,758)(70,765)(63,136)

Accounting Period
Revenue (Millions of yen)

Profit attributable to owners of the
Parent (Millions of yen)Comprehensive income attributable toowners of the Parent (Millions of yen)
Equity attributable to owners of the
Parent (Millions of yen)

Basic earnings per share for the year
(Yen)
Diluted earnings per share for the year
(Yen)

Net cash generated by operating
activities (Millions of yen)
Net cash (used in) / generated byinvesting activities (Millions of yen)
Net cash (used in) / generated byfinancing activities (Millions of yen)

(Separate, average number of
temporary employees)(Notes) 1. Revenue does not include consumption taxes, etc.
2. FAST RETAILING CO., LTD and its consolidated subsidiaries (the “Group”) started to prepare the consolidated financial
statements in accordance with IFRS for the year ended 31 August 2014.
3. The number of junior employees and part-time workers is stated as a separate number in parentheses as the average numberof people per year was calculated based on an eight-hour workday per person until the 56th year, but from the 57th year, theaverage number of registered personnel for the year is stated.

－2 －B. Non-Consolidated Financial Summary
Term

56th Year

57th Year

58th Year

59th Year

60th Year

Accounting period

Year ended
31 August
2017

Year ended
31 August
2018

Year ended
31 August
2019

Year ended
31 August2020

Year ended
31 August2021

Operating revenue (Millions of yen)

139,871

193,044

184,910

156,356

278,605

Ordinary profit (Millions of yen)

115,488

139,660

106,000

78,211

208,221

Net profit (Millions of yen)

64,264

122,158

106,11362,422

175,286

Capital stock (Millions of yen)

10,273

10,273

10,273

10,273

10,273106,073,656

106,073,656

106,073,656

106,073,656

106,073,656

Total net assets (Millions of yen)

377,103463,229

521,706

538,954

667,569

Total assets (Millions of yen)

670,111

993,413

1,054,758

1,063,356

1,100,398

Equity per share (Yen)

3,654.97

4,489.50

5,053.07

5,207.74

6,463.08

Dividends per share

350.00440.00480.00480.00480.00(175.00)(200.00)(240.00)(240.00)(240.00)

Basic net profit per share (Yen)

630.201,197.59

1,039.87

611.501,716.37

Diluted net profit per share (Yen)

629.28

1,195.63

1,038.14

610.44

1,713.61

Equity ratio (%)

55.6

46.1

48.9

50.0

60.0

Earnings on equity (%)

18.0

29.4

21.8

11.9

29.4

Price earnings ratio (Times)

49.9

43.3

59.5

103.5

42.3

Dividend ratio (%)

55.5

36.7

46.2

78.5

28.0

Number of employees:

1,166

1,345

1,389

1,589

1,617

(140)

(267)

(11)

(8)

(10)

87.6

144.7

174.8

178.9

205.7

(124.3)(136.2)(121.5)(133.4)(165.1)Highest share price (Yen)

44,37054,51070,23070,180110,500

Lowest share price (Yen)

30,46030,00047,04039,91062,860Total number of shares issued (shares)(Figures in parentheses indicate
interim dividends) (Yen)(Separate, average number of
temporary employees) (Persons)Total shareholder return (%)(Compared with TOPIX Total
Return Index)(Notes) 1. Operating revenue does not include consumption taxes, etc.
2. The number of junior employees and part-time workers is stated as a separate number in parentheses as the average numberof people per year calculated based on an eight-hour workday per person until the 56th year, but from the 57th year, theaverage number of registered personnel for the year is stated.
3. Up until the 57th year, contract employees and fixed-term employees were included in the average number of temporary
employees, but from the 58th year, they are included in the number of employees.
4. The highest and lowest share prices are from the first section of the Tokyo Stock Exchange.

－

3 －3. Corporate Profile
A. History
In March 1949, Hitoshi Yanai, the father of our current Chairman, President, and CEO Tadashi Yanai, founded Men’s Shop Ogori
Shoji in Ube City, Yamaguchi Prefecture. To solidify the management foundation, the business later became incorporated in May
1963 under the name Ogori Shoji Co., Ltd.
In June 1984, the Fukuromachi Store, a store specializing in casual clothing, opened its doors in Hiroshima City, Hiroshima
Prefecture as the first UNIQLO.
The Company’s history:
Date

Summary

May 1963

Tadashi Yanai takes over the family business and transforms it into Ogori Shoji Co., Ltd., capitalized
at 6 million yen, with headquarters at 63-147 Ogushi Village, Ube City, Yamaguchi Prefecture (now2-12-12 Chuo-cho, Ube City, Yamaguchi Prefecture).

June 1984

UNIQLO’s first location, the Fukuromachi Store, opens in Hiroshima (closed in 1991), marking themove into casual wear retailing with stores named UNIQLO.

September 1991

Ogori Shoji Co., Ltd. changes its name to FAST RETAILING CO., LTD., to embody its approach tobusiness.

April 1992

The main Ogori Shoji store, selling menswear, is converted to the UNIQLO Onda store (closed in2001).

April 1994

All the stores are completely renovated as casual clothing stores matching the UNIQLO brand.
The number of UNIQLO stores in Japan rises above 100 (109 directly operated stores, 7 franchises).

July 1994
April 1997

FAST RETAILING CO., LTD. lists its shares on the Hiroshima Stock Exchange.
FAST RETAILING CO., LTD. lists its shares on the second section of the Tokyo Stock Exchange.

February 1998

Construction of the head office is finished (717-1 Sayama, Yamaguchi City, Yamaguchi Prefecture) to
expand the Company’s headquarters capacity.

November 1998

The first urban UNIQLO store opens in Shibuya-ku, Tokyo (UNIQLO Harajuku store, closed in2007).

February 1999
April 1999

FAST RETAILING CO., LTD. lists its shares on the first section of the Tokyo Stock Exchange.
UNIQLO Shanghai office opens to further enhance production management.

April 2000
October 2000

Tokyo headquarters opens in Shibuya-ku, Tokyo.
Online store launches to open a new sales channel and make shopping easier for customers.

September 2001
September 2002

FAST RETAILING (U.K) LTD. opens first four UNIQLO stores in London.
Fast Retailing (Jiangsu) Apparel Co., Ltd. opens first two UNIQLO China stores in Shanghai.

January 2004

FAST RETAILING CO., LTD. invests in LINK HOLDINGS CO., LTD. (now LINK THEORYJAPAN CO., LTD.), the developer of Theory brand business apparel.

August 2004
November 2004

Capital reserves of ¥7 billion integrated into capital, increasing total capital to ¥10.273 billion.
Establishment of UNIQLO USA, Inc.

March 2005
April 2005

Establishment of UNIQLO HONG KONG, LIMITED.
Establishment of FR FRANCE S.A.S. (now FAST RETAILING FRANCE S.A.S.) and GLOBALMay 2005

RETAILING FRANCE S.A.S. (now UNIQLO EUROPE LIMITED).
Acquires management control of Nelson Finance S.A.S. (now CRÉATIONS NELSON S.A.S.), theNovember 2005

developer of the COMPTOIR DES COTONNIERS brand, and makes it a subsidiary.
Adopts a holding company structure to reinforce the UNIQLO brand and develop new businessFebruary 2006

opportunities.
Makes equity investment in, and makes a subsidiary of, PETIT VEHICULE S.A.S. (now
PRINCESSE TAM. TAM S.A.S.), developer of PRINCESSE TAM.TAM, a well-known brand of
lingerie in France.

March 2006

Establishes G.U. CO., LTD. to manage a new brand of less expensive casual clothing to follow
UNIQLO.

－

4 －

Date

Summary

November 2006UNIQLO Soho New York Store opens as the brand’s first global flagship store, with over 3,300
square meters of floor space.

November 2007

UNIQLO 311 Oxford Street Store opens in London as the brand’s first global flagship store inEurope.

December 2007
March 2009First UNIQLO France store opens in the Paris suburbs La Defense.
LINK THEORY HOLDINGS CO., LTD. (now LINK THEORY JAPAN CO., LTD.) becomes a

April 2009

subsidiary through a takeover bid.
First UNIQLO Singapore store opens in the Tampines 1 Mall (closed in 2021).

October 2009
March 2010

UNIQLO Paris Opera Store opens in France as a global flagship store.
UNIQLO establishes a wholly owned subsidiary in Taiwan.

April 2010
May 2010

First UNIQLO Russia store, UNIQLO Atrium, opens in Moscow.
UNIQLO Shanghai West Nanjing Road Store opens in China as a global flagship store.

October 2010
November 2010

First UNIQLO Taiwan store opens in Taipei.
First UNIQLO Malaysia store opens in Kuala Lumpur.

February 2011

FAST RETAILING CO., LTD. launches a global partnership agreement with the United Nations HighCommissioner for Refugees (UNHCR) to further reinforce ongoing company initiatives such as the

September 2011

All-Product Recycling Initiative.
First UNIQLO Thailand store opens in Bangkok.

October 2011
November 2011UNIQLO Fifth Avenue Store opens in New York as a global flagship store.
UNIQLO Myeongdong Jungang Store opens in Seoul, South Korea as a global flagship store.

March 2012
June 2012
September 2012
April 2013
June 2013
September 2013
September 2013

UNIQLO Ginza Store opens in Tokyo as a global flagship store.
First UNIQLO Philippines store opens in Manila.
BICQLO Shinjuku East Exit Store opens in Tokyo as a global hotspot store.
UNIQLO Lee Theatre opens in Hong Kong as a global flagship store.
UNIQLO Lotte Shopping Avenue Store opens as the first UNIQLO Store in the Republic ofIndonesia.
UNIQLO global flagship store opens in Shanghai.
First GU overseas store opens in Shanghai.

March 2014

HDRs (Hong Kong Depository Receipts) listed on the Main Board of The Stock Exchange of Hong
Kong Limited.

March 2014
April 2014

UNIQLO global hotspot store opens in Ikebukuro, Sunshine 60.
First UNIQLO Australia store opens in Melbourne.

April 2014
April 2014

First UNIQLO Germany store opens in Berlin, Tauenzienstrasse as a global flagship store.
UNIQLO global hotspot store opens in Tokyo, Okachimachi district.

October 2014
October 2014

UNIQLO global hotspot store opens in Tokyo, Kichijoji.
UNIQLO global flagship store, UNIQLO OSAKA, opens.

October 2015
December 2015

First UNIQLO Belgium store opens in Antwerp.
Fast Retailing issues ¥250 billion in unsecured straight bonds.

March 2016

The newly refurbished 311 Oxford Street global flagship store opens in London.

－

5 －

Date

Summary

April 2016
September 2016

Construction completed on state-of-the-art distribution center in Ariake, Tokyo.
UNIQLO Orchard Road Store opens as the first UNIQLO global flagship store in Southeast Asia.

September 2016
February 2017

First UNIQLO Canada store opens in Toronto.
UNIQLO CITY TOKYO Ariake Office opens. UNIQLO product and commercial functions moved

September 2017from Roppongi Office to Ariake Office.
First UNIQLO Spain store opens in Barcelona.

June 2018
August 2018

Issues ¥250 billion worth of unsecured straight bonds.
Sweden’s first UNIQLO store opens in Stockholm.

September 2018
October 2018

The Netherlands’ first UNIQLO store opens in Amsterdam.
UNIQLO Manila Store, UNIQLO’s global flagship store, opens in the Philippines.

October 2018
April 2019

Fast Retailing entered into a logistics-related strategic global partnership with Daifuku Co., Ltd.
Denmark’s first UNIQLO store opens in Copenhagen.

September 2019
September 2019

Italy’s first UNIQLO store opens in Milan.
Office functions of GU and PLST move to Ariake Office.

October 2019
November 2019

India’s first UNIQLO store opens in New Delhi.
Fast Retailing entered into a logistics-related strategic global partnership with MUJIN, Inc. andDecember 2019

Exotec Solutions SAS.
First UNIQLO Vietnam store opens in Ho Chi Minh City.

April 2020
June 2020

Opening of UNIQLO PARK Yokohama Bayside Store, a large-scale store for families.
Opening of UNIQLO Harajuku Store, a state-of-the-art store combining the real and virtual.

June 2020
April 2021

Opening of UNIQLO TOKYO, Japan's largest global flagship store, in Ginza.
In-house photography studio, new customer service center, and mock-up UNIQLO stores open at theNovember 2021

Ariake headquarters.
UNIQLO global flagship store, UNIQLO Beijing Sanlitun, opens in Mainland China.

－

6 －B. Our Business
The Group consists of FAST RETAILING CO., LTD. (the “Company”), 130 consolidated subsidiaries, and 3 associates accounted
for using the equity method.
Details of the Group’s businesses as well as the positioning of the Company and its main associates relative to the businesses are as
follows.
The segment categories in this section of the report are the same as the segment categories in the section headed “9. Financial
Information (6) Notes to the consolidated financial statements.”
Category
Holding company

Company name
FAST RETAILING CO., LTD.

OthersUNIQLO CO., LTD.

UNIQLO Japan

FAST RETAILING (CHINA) TRADING CO., LTD.*International
UNIQLOInternational

FAST RETAILING (SHANGHAI) TRADING CO., LTD.*UNIQLOInternational
UNIQLOInternational

FAST RETAILING (SINGAPORE) PTE. LTD.
UNIQLO (THAILAND) COMPANY LIMITED
PT. FAST RETAILING INDONESIA

OthersUNIQLOInternational
UNIQLOInternational

UNIQLO AUSTRALIA PTY LTD

UNIQLOInternational

Fast Retailing USA, Inc.

OthersUNIQLO EUROPE LIMITEDUNIQLOInternational

UNIQLO VIETNAM Co., Ltd

UNIQLOInternational

UNIQLO INDIA PRIVATE LIMITEDUNIQLOInternational

G.U. CO., LTD.

GUGU (Shanghai) Trading Co., Ltd.*GUFAST RETAILING FRANCE S.A.S.

Others

Theory LLC

Global Brands

PLST CO., LTD.

Global Brands

COMPTOIR DES COTONNIERS S.A.S.

Global Brands

PRINCESSE TAM.TAM S.A.S.

Global Brands

Other consolidated subsidiaries (110 companies)

Associates accounted for using
the equity method

UNIQLOUNIQLO TRADING CO., LTD.*FRL Korea Co., Ltd.

Consolidated subsidiaries

Reportable Segment

Associates accounted for using the equity-method(3 companies)

UNIQLOInternational /GU / Global Brands /OthersOthers* The English names of all subsidiaries established in the People’s Republic of China (“PRC”) are translated for identification only.
－

7 －(Notes) 1. “UNIQLO” business means the retail business of UNIQLO brand casual apparel in Japan and overseas.
2. “GU” business means the retail business of GU brand casual apparel in Japan and overseas.
3. “Global Brands” business means the planning, retail, and manufacturing of apparel in Japan and overseas.
4. “Others” includes real estate leasing businesses.
5. The Company corresponds to a specified listed company, etc. as stipulated in Article 49-2 of the Cabinet Office Ordinanceon Restrictions on Securities Transactions. As a result, assessment of the minimal standard for material facts under theinsider trading regulations is based on the consolidated numerical data.
The organizational structure is as follows:Business Structure

UNIQLOJapan

UNIQLO CO., LTD.

UNIQLOFAST RETAILING (CHINA) TRADING CO., LTD.*UNIQLO TRADING CO., LTD.*
FAST RETAILING (SHANGHAI) TRADING CO., LTD.*FRL Korea Co., Ltd.
UNIQLO (THAILAND) COMPANY LIMITED
PT.FAST RETAILING INDONESIAUNIQLO AUSTRALIA PTY LTD
UNIQLO EUROPE LIMITEDUNIQLO VIETNAM Co., Ltd
UNIQLO INDIA PRIVATE LIMITED
OthersUNIQLO
Business

International

FAST
RETAILING
CO.,LTD.
(holding
company)Group
Management
OperationGU
Business

Global Brands
Business

OthersBusiness

G.U.CO., LTD.
GU (Shanghai) Trading Co.,ltd.*
Others

Theory LLC
PLST CO.,LTD.
COMPTOIR DES COTONNIERS S.A.S.
PRINCESSE TAM.TAM S.A.S.
OthersFAST RETAILING (SINGAPORE) PTE. LTD.
FAST RETAILING FRANCE S.A.S.
Fast Retailing USA, Inc.
Others* The English names of all subsidiaries established in PRC are translated for identification only.

－

8 －

Sales
of
Product

Customers

C. Subsidiaries and Associates
Location

Nominal value of
issued ordinary /registered sharecapital(Thousands)(Consolidated subsidiaries)
UNIQLO CO., LTD.

Yamaguchi City,
Yamaguchi
Prefecture

JPY1,000,000

UNIQLOJapan

100.0%

Concurrent
directorships

FAST RETAILING (CHINA)TRADING CO., LTD.*

Shanghai, PRC

USD20,000

UNIQLOInternational

100.0%

Concurrent
directorships

UNIQLO TRADING CO., LTD.*

Shanghai, PRC

USD30,000

UNIQLOInternational

100.0%

Concurrent
directorships

FAST RETAILING (SHANGHAI)
TRADING CO., LTD.*

Shanghai, PRC

USD35,000

UNIQLOInternational

100.0%

Concurrent
directorships

FRL Korea Co., Ltd.

Seoul, South Korea

KRW24,000,000

UNIQLOInternational

51.0%

Concurrent
directorships

FAST RETAILING (SINGAPORE)
PTE. LTD.

Republic ofSingapore

SGD86,000

Others100.0%

Concurrent
directorships

UNIQLO (THAILAND)COMPANY LIMITED

Bangkok,
Kingdom ofThailand

THB1,200,000

UNIQLOInternational

75.0%(75.0%)-

PT. FAST RETAILING
INDONESIA

Jakarta,Republic ofIndonesia

IDR115,236,000

UNIQLOInternational

75.0%(75.0%)-UNIQLO AUSTRALIA PTY LTD

Melbourne,
Australia

AUD21,000

UNIQLOInternational

100.0%(100.0%)Loans

Fast Retailing USA, Inc.

New York, UnitedStates of America

Others100.0%

Concurrent
directorships
Loan guarantees

UNIQLO EUROPE LIMITED

London, United
Kingdom

GBP40,000

UNIQLOInternational

100.0%

Concurrent
directorships
Loan guarantees
Loans

UNIQLO VIETNAM Co., Ltd

Ho Chi Minh,
Vietnam

USD15,800

UNIQLOInternational

75.0%(75.0%)UNIQLO INDIA PRIVATELIMITEDNew Delhi
Republic of India

INR2,000,000

UNIQLOInternational

100.0%

Loans

G.U. CO., LTD.

Yamaguchi City,
Yamaguchi
Prefecture

JPY10,000

GU

100.0%

Concurrent
directorships

GU (Shanghai) Trading Co.,Ltd.*

Shanghai, PRC

USD20,000

GU

100.0%

Concurrent
directorships
Loans

Name

USD1,681,621

Details of main
businesses

Ownership ratioof voting rights

Relationship-

FAST RETAILING FRANCE
S.A.S.

Paris, France

EUR101,715

Others100.0%

Concurrent
directorships
Loan guarantees
Loans

Theory LLC

New York, UnitedStates of America

USD116,275

Global Brands

100.0%(100.0%)Concurrent
directorships

PLST CO., LTD.

Yamaguchi City,
Yamaguchi
Prefecture

JPY10,000

Global Brands

100.0%

Loans

COMPTOIR DES COTONNIERS
S.A.S.

Paris, France

EUR24,593

Global Brands

100.0%(100.0%)-PRINCESSE TAM.TAM S.A.S.

Paris, France

EUR20,464

Global Brands

100.0%(100.0%)-

Other consolidated subsidiaries(110 companies)

-

-

-

-

-

Associates accounted for using theequity method (3 companies)

-

-

-

-

-

* The English names of all subsidiaries established in the PRC are translated for identification only.

－

9 －(Notes) 1. The information given in the “Details of main businesses” column is the name of the business segment.
2. UNIQLO CO., LTD., FAST RETAILING (CHINA) TRADING CO., LTD., UNIQLO TRADING CO., LTD., FASTRETAILING (SHANGHAI) TRADING CO., LTD., FRL Korea Co., Ltd., FAST RETAILING (SINGAPORE) PTE. LTD.,UNIQLO (THAILAND) COMPANY LIMITED, PT. FAST RETAILING INDONESIA, UNIQLO AUSTRALIA PTY LTD,
Fast Retailing USA, Inc., UNIQLO EUROPE LIMITED, UNIQLO VIETNAM Co., Ltd., UNIQLO INDIA PRIVATELIMITED, G.U. CO., LTD., GU (Shanghai) Trading Co.,Ltd., FAST RETAILING FRANCE S.A.S., COMPTOIR DES
COTONNIERS S.A.S., and PRINCESSE TAM. TAM S.A.S. are specified subsidiaries.
3. Figures in parentheses in the “Ownership ratio of voting rights” column indicate the ratio of voting rights held by a Groupsubsidiary.
4. Net sales (excluding internal sales between other member companies of the consolidated Group) of UNIQLO CO., LTD.,
FAST RETAILING (CHINA) TRADING CO., LTD., and G.U. CO., LTD., are greater than 10% of consolidated revenue.
Key elements of profit / loss and financial position for the year ended 31 August 2021 are as below.
UNIQLO CO., LTD.
(1) Revenue

842,628 million yen(2) Profit before income taxes(3) Profit for the year

125,888 million yen
86,972 million yen(4) Total equity(5) Total assets

166,324 million yen
662,405 million yen

FAST RETAILING (CHINA) TRADING CO., LTD.
(1) Revenue(2) Profit before income taxes

406,103 million yen
78,366 million yen(3) Profit for the year(4) Total equity

58,879 million yen
183,108 million yen(5) Total assets

290,896 million yen

G.U. CO., LTD.
(1) Revenue

236,480 million yen(2) Profit before income taxes(3) Profit for the year

20,986 million yen
13,689 million yen(4) Total equity(5) Total assets

20,848 million yen
123,180 million yen

－

10 －

D. Employees(a) The GroupAs at 31 August 2021
Name of segment

Number of employees

UNIQLO Japan

13,472(29,334)UNIQLO International

30,792(20,707)

GU

4,885

(12,193)

Global Brands

3,544

(774)

52,693(63,008)

Others

1,279

(118)

All companies (shared)

1,617

(10)

55,589(63,136)

Total for reportable segments

Total(Notes) 1. The number of employees does not include operating officers, junior employees, or part-time workers.
2. The average number of registered personnel for junior employees and part-time workers for the year are shown in brackets( ).
3. The number of employees given as “All companies (shared)” represents administrative employees who could not be
categorized in a specific business segment.
(b) The Company
As at 31 August 2021
Number of employees
1,617

(10)

Average age

Average number of years
with the Company

37 years and 8 months

4 years and 6 months

Average annual wages(thousands of yen)
9,637

(Notes) 1. The number of employees does not include operating officers, junior employees, or part-time workers.
2. The average number of registered personnel for junior employees and part-time workers for the year are shown in brackets( ).
3. Figures for average annual wages include bonuses and other non-standard payments.
4. All of the Company’s employees are categorized as “All companies (shared).”5. When an employee is transferred from a subsidiary, the average years of service does not include the number of years spentat the subsidiary.
(c) Status of labor unions
There are no labor unions at the Company, but unions have been formed at some subsidiary companies. Management-labor
relations have been smooth, and there are no special items to report.

－

11 －

4. Management Discussion and Analysis
A. Business Plan
The statements with regard to the future are based on management decision and projections made by the Company based on
information available at the time of the publication of this report (26 November 2021).
Based on our corporate philosophy: Changing Clothes. Changing common sense. Change the world, Fast Retailing seeks todeliver the joy, happiness, and satisfaction of wearing truly great clothes to all people worldwide.
Our LifeWear (ultimate everyday clothing) epitomizes our clothes creation concept for simple, high-quality clothing thatenriches people’s lives and is carved from a desire to satisfy everyday life needs. Lifestyles are changing in the wake of the
COVID-19 pandemic, and the way that people choose clothes is also changing. We see more customers demanding good-fitting,comfortable clothes and clothes that don’t waste precious resources. These changes we are witnessing globally are inspiring
greater empathy among many different people with our ultimate LifeWear values. In addition to UNIQLO, other Fast RetailingGroup operations such as GU are also developing their own LifeWear ranges to meet their individual customer needs.
The Fast Retailing Group aims to achieve further growth by focusing on expanding our e-commerce business and our UNIQLOInternational and GU operations. By melding online and physical stores in our main business, we are accelerating the buildingof a framework that can provide customers with as many products and information when they want them. We have alreadyreformed our business to offer combined physical and online store services and unified inventory management. Our UNIQLOInternational business segment is accelerating new store openings in each market and, at the same time, opening global flagshipand large-format stores in major cities worldwide to encourage deeper understanding of our LifeWear concept. We see
particularly strong potential in the region spanning Greater China, Southeast Asia and India as the growth center of the global
economy. GU has established a position as the provider of fashion fun at amazingly low prices, and is currently expanding its
business primarily in Japan.
The most important thing for us is that our business growth also leads to the sustainable social and environmental development.
The world is facing many serious problems, such as the COVID-19 pandemic, widening income gaps, refugee problems, racism,and climate change. The spread of COVID-19 and the enormous impact of climate change on people’s lives and economic
activity are especially significant issues requiring a swift response. Human rights are also one of the most important issues. We
take our commitment to help create a better society and a better future through our business activities very seriously.
We are focusing particularly on the following issues:(1) Combatting COVID-19
Our highest priority is to protect the health and livelihoods of our customers, employees, production partners, and local
communities. As such, we have introduced measures at our stores and head offices to prevent the spread of COVID-19 and aresupporting partner factories.
We are also donating medical masks, isolation gowns, AIRism and HEATTECH products to support people in need or facing
crisis around the world, and we intend to continue doing whatever we can to help through our clothing business.
(2) Promoting Sustainability Activities
We are working to achieve our goals in each of our priority areas in order to help create a sustainable world through ourbusiness activities. We have determined and are currently working to achieve our CO2 reduction targets for 2030 to help combat
climate change. We are also strengthening our initiatives regarding human rights violations along the supply chain, working
environments, and environmental conservation issues. In addition to our current regular auditing of sewing factories and fabricproducers, we are seeking to establish greater traceability right back to the initial raw materials stage.
(3) Progressing our Transformative Ariake Project
We are pursuing our transformative Ariake Project to help transform ourselves into a true digital consumer retailing company
that understands exactly what customers want right now and instantly turns those desires into products for speedy delivery. We
intend to develop products spurred by customer opinion, achieve more accurate demand forecasting and inventory control,
shorten lead times on additional production orders, and progress supply chain reform of our logistical systems through theintroduction of automated warehouses. At the same time, we are working to expand our e-commerce operations by successfully
merging our physical and e-commerce store networks and offering more extensive services.
－12 －(4) Making E-commerce Our Pillar BusinessWe are seeking to meld e-commerce and physical store services in our main business to help expand online sales. In addition tostrengthening two-way communication with customers, we are working on measures to make shopping more convenient, suchas building a new framework that integrates physical and online stores and unifying inventory. We are also progressing with theintroduction of automated warehouses and proprietary e-commerce platforms and are establishing systems to further expand
sales.
(5) Advancing our LifeWear Ultimate Everyday Clothing
We intend to continue creating world-class LifeWear to meet the everyday needs of customers of all ages worldwide. We not
only use fashion-related information collected worldwide, but also customer opinions voiced in our stores and via our ecommerce operations to improve products and develop new products. We intend to strengthen our ability to develop LifeWear
that meets customer needs not only at UNIQLO, but at GU and other Group brands as well.
(6) Further Expansion of UNIQLO International
UNIQLO International is the key driver of Group growth. We intend to continue the segment’s high growth by accelerating newstore openings in the Greater China and Southeast Asia & Oceania regions. Thanks to cost structure reforms, we now have asystem in place for encouraging an early move into the black for our North American UNIQLO operation and improved
profitability in Europe. We intend to expand our business in North America and Europe by compiling product ranges that meet
local customer needs and seeking to expand e-commerce operations.
(7) Further Growth for UNIQLO Japan
UNIQLO Japan is seeking to promote further growth by developing products to suit changing lifestyles and creating new formsof customer contact that better combine physical and online store offerings. We are looking to deploy our scrap and build policyof replacing less profitable stores with better located ones so we can build a store network that is better suited to today’s new
ways of living. We also intend to provide a better shopping experience by deepening local store management with steadfast
community roots and developing product ranges and services that fully satisfy local demand.
(8) Expanding GU Operation
GU’s strength lies in low-priced fun fashion, but we are aiming to polish its ability to develop products that perfectly capture
mass fashion trends, improve the accuracy of product planning, and establish a production system that boasts shorter lead times.
We are also working to strengthen GU’s development of even more competitive low-priced products by reforming theoperation’s materials procurement and production processes. We plan to continue opening more GU stores in Japan and press
ahead with store openings in Greater China and other international markets.
(9) Promote management framework driven by Global One and Zen-in Kei principles
We have been actively promoting Global One and Zen-in Keiei management principles, which encourage the use of the best
available global methods and a self-motivated, united global approach to any challenge, to strengthen UNIQLO, GU, Theory
and other Group brands worldwide. In order to instill these management principles while also unifying business processes
across the Group, we are strengthening employee training in the Fast Retailing spirit and approach to business execution. We arealso working to actively recruit talented human resources and nurture resources from around the world in order to nurture future
managers and leaders.

－

13 －

B. Risk(1) Policy
The Group has established a Risk Management Committee directly under the Board of Directors to serve as an organization toregularly identify potential risks in business activities, pinpoint critical risks, and establish and strengthen its risk management
structure. Chaired by the Group CFO, the Committee centrally manages risk for the entire company. The Committee analyzes
and evaluates how much and how often a risk impacts business, and discusses countermeasures starting with the mostsignificant risks. It aims to establish a system to keep risks in check before they occur, and achieve a rapid resolution to risks
that have occurred. It also reports critical risks to the Board of Directors and provides concrete support to each department
regarding risk countermeasures.

－

14 －

(2) Individual risks
Of the risks pertaining to the status of businesses and accounting as described in the year-end report, the following are the mainrisks that it is recognized would have a particularly large impact on the Group's operating results and financial situation. Futurerisks discussed in the descriptions below are based on the Group's assessment as of the date of publication of this document. In
addition, the following list of risks is not exhaustive and may be affected in the future by risks that are unforeseeable or not
perceived to be critical as of the date of publication of this document. Furthermore, risks that are not indicated to have"materialized" in the "Risks and their Effects" column have not yet resulted in material risks, and both the likelihood and timingof their materialization remains uncertain.

Risk Item

Risks and their Effects

Main Initiatives

Risk of the large-scale, global• The large-scale, global spread of infectious• Led by the Company-wide Emergency

spread of infectious diseases(including COVID-19)

diseases such as COVID-19 may cause
difficulties in the production and supply of

Response Headquarters established by the
Risk Management Committee, the Group

products to stores due to infection among
employees of the Group and its partners, as welldevelops medical evidence-based infection
prevention measures aided by advice

as due to measures enacted to prevent the spreadof the disease.
• The global spread and prevalence of COVID-

received from experts, and implements suchmeasures at all Group offices and stores

19 has already materialized risks that have had

while ensuring all Group employees fully
understand them, in order to ensure that all

negative effects on the entire Group, including
restricted production plant operations, logisticalcustomers can shop with peace of mind.
• We provide supplier factories withdelays, restricted store hours, and more.

guidelines for improving their hygiene
management to prevent infection at factories
and for employee remuneration if factories
are forced to shut down.
• In order to reduce the risk of infection in
the Group, we are encouraging employees,
their families, and those living with them toget vaccinated.

Management personnel risk

Members of the Group's management team, led• In each of the Group's businesses, we haveby Chairman, President and CEO Tadashi Yanai,
play a major role in their respective areas ofestablished a team-based executive
management structure to ensure that

responsibility. If any officer becomes unable tofulfill his or her duties and the Group is unabledecision-making and execution of duties are
not dependent on specific management

to find any personnel who can take on thoseimportant responsibilities, this could have an

personnel.
• In each business, the managers themselves

adverse impact on business performance.

personally train the management personnel
who will be their successors in thosepositions.
• We also actively recruit globally active
management talent on an ongoing basis, andwe have established dedicated educational
institutions to educate and train our hired
talent into managers.

－

15 －

Risk Item

Risks and their Effects

Main Initiatives

Country risks and risks
pertaining to international

The Group's product production, supply, and saleinfrastructure may be adversely impacted by• The Group is moving forward withaffairs

events in countries and regions in which we
manufacture products and conduct business, due

flexibly to changes in international
conditions. This includes dispersing

to factors including changes in political or
economic conditions, social disorder or

production sites across multiple countries andregions, as well establishing production

deterioration of public safety due to terrorism orconflicts, changes in legal or tax systems, or the

management offices at our main production
hubs to enable the timely monitoring of andoccurrence of large-scale natural disasters suchas earthquakes, strong winds, or water disasters.

quick response to local circumstances.
• We have accounting, tax, and legal

establishing a supply chain that can respondspecialists stationed at Group companies'
offices to ensure that we can provide quick
and appropriate responses andcommunication in the event that a riskmaterializes.
• With respect to cross-border tensions anddeteriorating racial relations in specificcountries and regions, the Group as a global
company aims to contribute to the resolutionof social issues in countries and regions inwhich we operate, and to achieve a lasting
peaceful co-existence and co-prosperity inthe communities within each region andcountry.
Environmental risks• Delay in responding to climate change such as• In order to reduce our impact on climate

by reducing greenhouse gas emissions orchange and biodiversity, we will work toswitching to renewable energies, and failure toproperly reduce waste emissions, pursue

identify and reduce greenhouse gas emissions
in our business activities across the board,

recycling initiatives, and manage chemical
substances may result in the public losing trust

including every stage from production todisposal of products. In promoting ourin the Group brand.
• There is the risk that the increase in extreme

initiatives, we will respect the long-term goal(the Paris Agreement) of reducing greenhouse

weather due to climate change may adversely
affect our product supply systems and ourgas emissions by 2050, which was formulated
based on the United Nations Frameworkbusiness as a whole.

Convention on Climate Change, and we will
set specific targets and promote activities
geared toward achieving this goal.
• Led by the Sustainability Committee, we
persist in continually implementing concreteand highly effective initiatives under ourEnvironmental Policy, in five priority areas:
Addressing climate change, improving energy
efficiency, managing water resources,
improving waste management and resource
efficiency, and managing chemical substances.
• In June 2021, we expressed our support for
proposals by the Task Force on Climaterelated Financial Disclosures (TCFD), and areworking to disclose such information inaccordance with the TCFD.
－

16 －Risk Item
Large-scale disaster risks

Risks and their Effects

Main Initiatives

Large-scale disasters such as earthquakes,
typhoons, volcanic eruptions, fires, storms andLed by the Risk Management Committee, weare committed to establishing an

floods, explosions, and collapsed buildings canadversely affect our supply and sales systems,

infrastructure by which, in the event of an
actual or potential major earthquake or otherand also our management infrastructure in areas
where there are head offices, retail stores, andmajor disaster, we have an emergency
command system prepared, run by the

production plants for products sold by theGroup.

Emergency Response Headquarters to:ensure the safety of customers, employees,
and related personnel; mitigate damage tobusiness resources; prevent secondary
disasters; develop system infrastructure anddecentralized restoration bases for quickly
restoring business; prepare crisis
management manuals and promote the global
implementation of those manuals.

Risks related to resource

Disasters, climate change, and other factors may

We have entered into procurement

management and the
procurement of raw materials

cause escalating prices or difficulty in procuring
the raw materials (such as cotton, cashmere,

agreements with multiple suppliers so that weare able to source reasonably priced raw

down, etc.) used in the products sold by theGroup's businesses. If these risks materialize, thematerials, without having to rely on a specificsupplier for a specific raw material.

Group's product supply systems andperformance may be adversely affected.
Information security risks• If sensitive information such as customer• In order to ensure that confidential

information (including personal information)and trade secrets, etc. were to be leaked or lost,

information is properly managed, we haveestablished an Information Security Office

we would need to respond by recovering theinformation, and apologizing and paying

under the direction of a Chief Security
Officer (CSO) who oversees the entire group,

damages. This may adversely affect our businessperformance and lead to loss of trust among ourand works in cooperation with the IT andlegal departments of each country and region

customers.
• If a government were to determine that we arein which we operate.
• The Information Security Office builds andin violation of legal regulations that restrict thetransfer of personal information between

improves the infrastructure needed toproperly manage sensitive information

countries and regions, such as the EU's General
Data Protection Regulation (GDPR), we may(especially customers' personal information)in anticipation of external attacks, internallose customers' trust and be subject to significant
fines that would negatively impact our businessfraud and various other incidents. This isdone by putting in place infrastructure,

performance.

evaluating our administrative processes andours contractors, establishing andstandardizing internal rules, and conducting
regular educational and awareness activities
in each business division.

－

17 －

Risk ItemIntellectual property risks

Risks and their Effects

Main Initiatives• Intellectual property rights apply in relation to• The Group has a dedicated department in

the Group's products and the latest technologies

place dealing with intellectual property. This

used in all kinds of areas, including productmanagement, store operations, and e-commerce

department investigates infringements during
product development and during thewebsites. These rights not being licensed to us
by their owners would present difficulties in our

implementation of technologies, and in aneffort to prevent infringements of intellectualuse of these technologies or in supplying
products.
• If these technologies or products were toproperty rights also runs education andawareness activities for Group employees.
• We actively take steps to acquire the rights

infringe on the intellectual property rights ofto new technologies that we develop.

others, we may be liable to pay substantial
damages or license fees that may adversely

Furthermore, we monitor markets in the
countries and regions in which we operate oraffect our business performance.
• If the Group's products were to be copied byplan to expand, and cooperate with local
legal departments, local law firms, andthird parties and sold at lower prices, this may
negatively impact our business.

government agencies to gather information
about counterfeit products and otherintellectual property infringements.
• If an infringement is confirmed or we fearsuch an infringement may have occurred, wework with local legal departments and local
law firms to quickly consider our course ofaction, including a legal response.

－

18 －

Risk Item
Human rights risks

Risks and their Effects

Main Initiatives• Within the Group or its supply chain,• Our supply chain policy is based on our

deterioration in working environment or in
health and safety, human rights violations suchview that our most important responsibility is
to respect the basic human rights of all

as forced labor, child labor, harassment or
discriminatory behavior, or other such acts thatpeople working in the supply chain of Groupbusinesses, whether they are employees ofsignificantly infringe on the human rights of
those affected may result in the Group losing thethe Group or of our business partners, and toensure those employees' physical and mental

trust of our customers and suppliers, and may
negatively impact the supply and sale of ourhealth, safety, and peace of mind.
• We have developed human rights

products.
• In Europe, the United States, and otherguidelines, provide code of conduct (COC)
training, operate an employee hotline, andcountries and regions, tighter regulations andlegislation aimed at protecting human rights in

conduct regular reviews in order prevent
human rights violations from occurring.
• Led by our Sustainability Department, we

the supply chain may have a negative impact on
the production, transportation and sales systems
for the Group's products.

are committed to maintaining and improving
suitable working environments throughmonitoring work environments at supplierfactories, and operating hotlines for theemployees of those factories. We are also
promoting the procurement of raw materials
for which the production processes have been
confirmed to properly protect human rights
and working conditions, in accordance withinternational standards.
• Going forward, we will establish
traceability down to the raw materials for all
countries and regions, and we will build asystem that allows us to confirm forourselves that there are no issues with humanrights or working conditions throughout theentire supply chain. In addition, we will
make use of third-party certification toobjectively verify that human rights andworking conditions are being properly
protected.
• In the event that a human rights violation
does occur, in addition to the Human Rights
Committee investigating and deliberating on
the matter, we also have in place aframework for providing mental healthcare
for the victim.

－

19 －

Risk Item
Risks originating from business
partners

Risks and their Effects

Main Initiatives• There are a variety of risks associated with

• In order to avoid entering into businessbusiness partners involved in product planning,

relationships with inappropriate partners, allproduction, transportation, and sales.
• These risks include the possibility that ourGroup companies carry out credit checks asnecessary when entering into a transaction

partners may not share the values and principlesof the Group, which may lead to a drop inwith a new business partner.
• In addition, in order to build appropriate

business efficiency, or the possibility that it
could be difficult for us to adequately collect on

business relationships with all of ourpartners, we have established Businessreceivables. These possibilities can have an
adverse effect on our business performance, andPartner Conduct Guidelines and conductbusiness only with those partners who agree

may result in our unintentionally engaging inbusiness with anti-social organizations (e.g.

to and comply with those guidelines.
• In response to the risks associated withcriminal groups and individuals) or violations oflaws on the part of our partners. If these risks

dealing with delivery operators andwarehouse operators, each of our businesses

were to materialize, they may lead to a loss oftrust in the Group among our customers andhas logistics personnel in place who are in
constant communication with our delivery

society.
• In addition, for example during theand warehouse-operating business partners.
These personnel are on-hand to promptlytransportation and delivery of products bydelivery operators or while products are being

report any problems that arise in productshipping or storage to local management andstored at a warehouse, products may bedestroyed, damaged, or stolen as a result of a

the Global Logistics Headquarters, a system
which enables them to promptly consider andnatural disaster or human behavior, or it may not
be possible to hand over products due to aaction a response.

problem arising with our partner or with local
laws and regulations.
Impairment risks

If profitability decreases due to changes in thebusiness environment, impairment losses may be• We apply impairment accounting torecorded under property, plant, and equipment
and right-of-use assets, among others.

identify unprofitable stores, and to ensure
proper accounting.
• We identify the underlying causes of aquickly identify signs of impairment, quickly

store's drop in profitability, and develop
fundamental profitability improvement plans
for them.

－

20 －Risk Item
Foreign currency risks

Risks and their Effects

Main Initiatives• As many of the products handled by each of• In order to mitigate foreign exchange

the Group's businesses are imported fromvolatility in our international businesses, weoverseas production plants, fluctuations in thecurrencies of settlement may have an adverse

have forward exchange contracts based on
our procurement forecasts regarding each

effect on the performance of each of ourbusinesses in some countries or regions.
• As the Group as a whole has financial assets

country and regional business. In thisprocess, the Group Board of Directors

in a variety of currencies in line with where we
operate our businesses, fluctuations in exchange
rates against the Japanese yen, which is ourfunctional currency, can have a major impact onfinancial gains and losses.

discusses and approves specific hedging
policies such as hedge ratios, time periods,
and other aspects, taking into account theircontribution to our financial security.
• The Board of Directors deliberates on theviability of the currencies in which ourfinancial assets are held.

Risks arising from changes inthe business environment

In each country and region in which the Group'sbusinesses operates, changes in the businessWe collect timely information on the
products required by customers in theenvironment, such as inclement weather andchanges in consumption trends, may result incountries and regions in which the Group'sbusinesses operate. We have thedrops in product sales and the accumulation ofexcess inventory, negatively impacting our

infrastructure in place to immediately
commercialize those products as well as tobusiness performance.

produce and sell the quantity required,responding to changes in the businessenvironment as flexibly as possible.

－

21 －

C. Management’s Discussion and Analysis of Consolidated Financial Condition, Results of Operations and Cash Flows(1) Summary of Business Results(a) Business Results
The Fast Retailing Group’s revenue increased and profit expanded significantly in fiscal 2021, or the twelve months from 1
September 2020 to 31 August 2021. Consolidated revenue totaled 2.1329 trillion yen (+6.2% year-on-year) and operating profit
totaled 249.0 billion yen (+66.7% year-on-year). Business performance recovered primarily at UNIQLO operations in fiscal
2021 compared to the previous year when performance declined dramatically under the heavy impact of the COVID-19
pandemic. We reported an impairment loss of 16.9 billion yen mainly on UNIQLO International operations and a gain of 8.7
billion yen from the liquidation of J Brand, Inc., resulting in a net cost of 6.5 billion yen under other income/expenses. When we
liquidated J Brand, Inc. in August 2021, we recorded a liquidation gain on foreign exchange movements following a subsequent
weakening in the Japanese yen compared to the exchange rate at the time of acquisition. We also recorded 16.8 billion yen infinance income net of costs, mainly comprising a 19.2 billion yen foreign exchange gain on foreign-currency denominated assets
and other items. As a result, profit before income taxes increased to 265.8 billion yen (+73.9% year-on-year) and profit
attributable to owners of the Parent expanded to 169.8 billion yen (+88.0% year-on-year) in the twelve months to 31 August
2021.
Capital expenditure increased by 17.9 billion yen year-on-year in fiscal 2021 to 100.6 billion yen. That figure can be broken
down into 15.7 billion yen for UNIQLO Japan, 38.5 billion for UNIQLO International, 3.8 billion yen for GU, 1.8 billion yen for
Global Brands, and 40.7 billion yen for systems, etc. While investment in new store openings declined compared to the previous
year in which we opened many global flagship stores and large-format stores, we did increase our investment in global
automated warehousing as part of our transformative Ariake Project.
As a united Group, we are determined to strengthen initiatives designed to expand our business operations and promotesustainability as part our quest to become a global No.1 brand. We work hard to ensure our LifeWear ultimate everyday wear is
produced and sold in working environments that are healthy, safe, and environment- conscious, and strive to help solve a variety
of social issues. We are currently channeling our efforts into expanding our e-commerce, UNIQLO International, and GU
businesses as key pillars of operational growth. With regards to e-commerce, we are accelerating the building of a frameworkthat will promote our main business by melding online and physical stores so we can offer as many of the products andinformation that customers want, when they want them. We are already pressing ahead with reforms that will enable us to offer
more services that combine the strengths of our physical store and e-commerce network and unify inventory management.
Regarding UNIQLO International, we are accelerating the opening of new stores in all markets and areas in which we operate,and seeking to instill deeper and more widespread empathy for UNIQLO’s LifeWear concept by opening global flagship storesand large-format stores in the world’s major cities. In terms of our GU segment, we are working to strengthen GU’s position as abrand that offers fun fashion at amazingly low prices and seeking to expand the GU store network primarily in Japan.
UNIQLO Japan
UNIQLO Japan reported revenue of 842.6 billion yen (+4.4% year-on-year) and a large increase in operating profit to 123.2
billion yen (+17.7% year-on-year) in fiscal 2021. Full-year same-store sales (including e-commerce) increased 3.6% year-onyear. In the first half from 1 September 2020 through 28 February 2021, same-store sales rose 5.6% year-on-year on the back ofstrong sales of products that fulfilled customer demand for stay-at-home items as well as core Fall Winter ranges. However,same-store sales increased by a much lesser 0.9% year-on-year in the second half from 1 March through 31 August 2021 as sales
were adversely impacted by the declaration of a state of emergency and unfavorable weather. Meanwhile, full-year e-commerce
sales are expanding favorably, rising 17.9% year-on-year to 126.9 billion yen in fiscal 2021 to constitute a 15.1% proportion of
total revenue.
The UNIQLO Japan gross profit margin improved 1.4 points year-on-year in fiscal 2021 thanks to efforts to improve cost of
sales and our decision to curb discounting of products. From 12 March 2021, we made our products easier for customers topurchase by changing our product price displays in Japan to show just one tax-inclusive price and keeping prices the same byabsorbing the consumption-tax component ourselves. We have been able to maintain cost percentages close to regular levels by
working successfully with partner factories to improve cost of sales by encouraging the use of common materials, controlling thenumber of product items, and minimizing fabric wastage. The selling, general and administrative expense ratio also improved by
0.4 point year-on-year thanks to more efficient distribution and advertising and promotion spending.

－

22 －

UNIQLO International
UNIQLO International recorded significant increases in both revenue and profit in fiscal 2021, with revenue rising to 930.1
billion yen (+10.2% year-on-year) and operating profit expanding to 111.2 billion yen (+121.4% year-on-year). While segment
performance is still being heavily impacted by COVID-19, performance has recovered strongly in regions and during periods
when infections were contained.
Breaking down the UNIQLO International performance into individual regions and markets, the Greater China region (Mainland
China market, Hong Kong market, and Taiwan market), which was not impacted as heavily by COVID-19, performed strongly
by achieving a large increase in profit. In fact, the Greater China region reported record results, with revenue rising 16.7% yearon-year to 532.2 billion yen and operating profit expanding by 52.7% year-on-year to 100.2 billion yen. The region’s operating
profit margin also improved significantly to 18.8% thanks to improvements in the gross profit margin and selling, general andadministrative expense ratio. While UNIQLO South Korea reported a slight decrease in full-year revenue, the operation did
manage to move back into the black. In contrast, UNIQLO South Asia, Southeast Asia & Oceania (Southeast Asia, Australia, andIndia) reported an approximate 15% year-on-year decline in operating profit in fiscal 2021 after suffering the heavy impact of
the COVID-19 pandemic throughout the period. Within that region, the nations that were hit hardest by COVID-19, Malaysia,
Thailand, and the Philippines, reported declines in both revenue and profit, while revenue and profit increased in Singapore,
Indonesia, India, and Australia, and Vietnam reported a large rise in revenue and turned a profit for the year. Despite theparticularly heavy COVID-19 impact in S/SE Asia and Oceania region, sales did prove strong during the periods when stores
were able to reopen for business. Sales recovered sharply in North America once COVID-19 restrictions were eased from May
onward, helping the North American operation report a profit in the second half of the year and halve its full-year loss. UNIQLO
Europe reported a large rise in revenue and a positive operating profit thanks to strong e-commerce sales and a strong
performance from our Russia operation. Despite the pandemic, we have been able to greatly improve profitability in line withthe recoveries in sales in North America and Europe thanks to some determined reforms of earnings structures that focused on
improving gross profit margins, closing unprofitable stores, reducing fixed costs, and normalizing inventory levels.
GU
Our GU segment recorded an increase in revenue but a decline in profit in fiscal 2021, with revenue reaching 249.4 billion yen(+1.4% year-on-year) and operating profit totaling 20.1 billion yen (−7.6% year-on-year). In the first half, items such as chef’s
pants and sweat-style knitwear sold well. However, in the second half, sales fell short of expectations after GU was impacted by
the declared state of emergency, suffered lost sales opportunities caused by shortages of strong-selling items, and produced someproducts that did not fully grasp the prevailing fashion trend. As a result, full-year GU same-store sales declined slightly
compared to the previous year. GU’s gross profit margin declined 0.9 point year-on-year on the back of stronger season-end
inventory rundowns. GU e-commerce sales rose on the back of stronger conveyance of pertinent information, expanding
approximately 50% compared to fiscal 2019 levels and constituting approximately 11% of total sales.
Global Brands
In fiscal 2021, the Global Brands segment reported a decline in revenue to 108.2 billion yen (−1.3% year-on-year) and an
operating loss of 1.6 billion yen compared to a 12.7 billion yen operating loss in the previous year. This considerable reduction
in operating loss was facilitated by the recording of a gain from the liquidation of J Brand, Inc. and an improved performancefrom our Theory operation. Indeed, the Theory operation reported an increase in revenue and a return to the black thanks tosmaller losses from Theory in the US and a strong performance from Theory in Asia (Mainland China market and Hong Kong
market), which reported significant rises in both revenue and profit. Our PLST label reported a decline in revenue and an
operating loss of similar magnitude to the previous year. Comptoir des Cotonniers reported a decline in revenue and a wider
operating loss due primarily to the adverse impact of prolonged temporary store closures mainly in France through May. Finally,
while we have liquidated J Brand, Inc. the J Brand label will continue to be owned by the Fast Retailing Group and offer
products as a Group brand.

－

23 －

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 and Implementing good corporate governance. Our main activities for the current period involved:■ New value creation through products and sales: As the effects of COVID-19 continue to be felt, UNIQLO is continuing to sell
AIRism masks and GU is selling masks with high-performance filters. UNIQLO also developed and launched a line of frontopening innerwear including T-shirt and bras, which went on sale in September 2020. This was in response to the requests from
hospitalized individuals and people with disabilities who find pull-on innerwear difficult to get on and off.
■ Respect for human rights and working conditions in the supply chain: To help keep our manufacturing partners and factory
employees safe and secure from COVID-19 infection, we are working to prevent the spread of infection in factories, along withreviewing wage compensation and other employment-related issues arising from the closure of our factories, and offering
guidance for improvements. In addition, we are making preparations so the company can ensure there are no human rights issues
throughout our supply chain, by continuously strengthening our efforts to address human rights and labor issues in the supply
chain, establishing traceability down to the raw materials for all countries and regions, and expanding the scope of our workingenvironment audits.
■ Consideration for the environment: We expanded our existing All-Product Recycling Initiative, and in September 2020, welaunched our "RE.UNIQLO" activities. In November 2020, we began selling a new recycled down jacket, in which 100% of thedown and feathers come from products collected from customers. In recognition of our efforts to prevent water pollution, reducewater use and combat risks from water such as flood damage, the CDP (an international non-profit organization that provides aplatform for disclosure of environmental information) gave us the highest rating for water resource measures and included us in
its water security A List in December 2020. In September 2021, we announced that our new goal for reducing greenhouse gas
emissions was to reduce emissions by 90% across all of our stores and major offices, etc. by FY2030, to reduce, by 20%(compared to FY2019; absolute amount), the emissions associated with raw material production, fabric production, and sewingof UNIQLO and GU products , and to increase our company's renewable energy use to 100%. The international Science Based
Targets initiative approved these goals as science-based targets (SBTs) — greenhouse-gas emissions reduction targets based on
the targets set in the Paris Agreement.
■ Community support: To combat COVID-19, we are donating masks and isolation gowns to medical and care facilities, etc.
around the world, as we did last year. In particular, we provided emergency assistance totaling 220 million rupees(approximately 330 million yen) to India, where there had been severely impacted by COVID-19. This assistance included over
600,000 UNIQLO AIRism masks. In addition, we are working with the United Nations High Commissioner for Refugees(UNHCR) to donate approximately 3 million UNIQLO AIRism masks to refugees and displaced persons in a total of 10
countries, including Argentina, Iraq, Afghanistan and Myanmar.
■ Employee satisfaction: In our stores, we are helping to prevent the spread of COVID-19 and prioritizing the health ofcustomers and employees by continuing with the policies we have instituted, such as health checks for staff members, mask
wearing and hand sanitizing. In order to make our locations safe and secure places for our employees to work, we are providing
masks and disinfectants, and increasing ventilation. We are also promoting working from home, depending on the nature of thework. In addition, we are actively implementing administration of COVID-19 vaccines in workplaces in Japan and in certain
other countries. In order to create a work environment in which diverse human resources can demonstrate their abilities, theDiversity Promotion Team has been working on career development for female employees and improving the ratio of female
managers to male managers. We have also conducted training programs for female management candidates and careerdevelopment sessions with female managers.

－

24 －

■ Good management (governance): To enable rapid and transparent management, a number of committees are engaged in open
and active discussions. The Nomination and Remuneration Advisory Committee discussed the structure of compensation
systems for officers and the criteria for appointing candidates for directors. The Risk Management Committee has beenstrengthening risk management in business activities, and is continually discussing our response to issues such as the COVID-19
pandemic, vaccinations, the risk of major natural disasters such as an earthquake directly below Tokyo, information security
risks, and risks related to the international situations. In addition, the Human Rights Committee is actively supervising andadvising on efforts to protect human rights, including the implementation and improvement of employee human-rights surveys
on harassment and discrimination, and responding to the human rights risks of migrant workers at partner factories. Upon
receiving advice, the Sustainability Department, which is the responsible department, strengthened audit checks on the working
conditions of migrant workers, and provided the guidance on a hotline.
(b) Cash Flow Information
Cash and cash equivalents as at 31 August 2021 had increased by 84.2 billion yen from the end of the preceding fiscal year, to1.1777 trillion yen.
(Operating Cash Flows)
Net cash generated by operating activities for the year ended 31 August 2021 was 428.9 billion yen, which was an increase of
164.1 billion yen (+62.0% year-on-year) from the year ended 31 August 2020. The principal factors were 265.8 billion yen in
profit before income taxes (an increase of 113.0 billion yen from the year ended 31 August 2020), 16.9 billion yen in
impairment losses (a decrease of 6.1 billion yen from the year ended 31 August 2020), 19.2 billion yen in foreign exchange
gains (a decrease of 17.7 billion yen from the year ended 31 August 2020), a decrease of 15.3 billion yen in trade and otherreceivables (an increase of 19.4 billion yen from the year ended 31 August 2020), a decrease of 36.7 billion yen in inventories(an increase of 39.4 billion yen from the year ended 31 August 2020), an increase of 0.3 billion yen in trade and other payables(a decrease of 18.2 billion yen from the year ended 31 August 2020), a decrease of 3.4 billion yen in other assets (a decrease of
7.1 billion yen from the year ended 31 August 2020), an increase of 9.3 billion yen in other liabilities (an increase of 53.8
billion yen from the year ended 31 August 2020), and 80.5 billion yen in income taxes paid (a decrease of 5.0 billion yen fromthe year ended 31 August 2020).
(Investing Cash Flows)
Net cash used in investing activities for the year ended 31 August 2021 was 82.5 billion yen, which was an increase of 6.6
billion yen (+8.7% year-on-year) from the year ended 31 August 2020. The principal factors were a net increase of 2.3 billion
yen in bank deposits with original maturities of three months or longer (a decrease of 2.8 billion yen from the year ended 31
August 2020), 56.5 billion yen in payments for property, plant and equipment (an increase of 10.0 billion yen from the year
ended 31 August 2020), 19.6 billion yen in payments for intangible assets (a decrease of 1.3 billion yen from the year ended 31
August 2020), 0.8 billion yen in payments for acquisition of right-of-use asset (a decrease of 0.9 billion yen from the year ended
31 August 2020), 3.9 billion yen in payments for lease and guarantee deposits (a decrease of 3.1 billion yen from the year ended
31 August 2020), 4.5 billion yen in proceeds from collection of lease and guarantee deposits (an increase of 1.8 billion yen fromthe year ended 31 August 2020), and 4.2 billion yen in payments for acquisition of investments in associates (an increase of 4.2
billion yen from the year ended 31 August 2020).
(Financing Cash Flows)
Net cash used in financing activities for the year ended 31 August 2021 was 302.9 billion yen, which was an increase of 119.7
billion yen (+65.3% year-on-year) from the year ended 31 August 2020. The principal factors were a net decrease of 3.5 billion
yen in short-term loans payable (an increase of 17.0 billion yen from the year ended 31 August 2020), and 100.0 billion yen in
repayment of redemption of bonds (an increase of 100.0 billion yen from the year ended 31 August 2020).

－

25 －

(2) Summary of Revenue and Purchasing(a) Revenue by division
Year ended 31 August 2020
(From 1 September 2019 to
31 August 2020)

Division

Revenue(Millions of yen)

Year ended 31 August 2021
(From 1 September 2020 to
31 August 2021)

Percentage of total(%)

Revenue(Millions of yen)

Percentage of total(%)

Men’s clothing

319,98515.9

339,399

15.9

Women’s clothing

359,75317.9

353,774

16.6

Children’s & babies’ clothing

60,804

3.0

67,790

3.2

Goods and other items

35,391

1.8

51,858

2.4

775,934

38.6

812,82238.1

30,952

1.5

29,806

1.4

806,88740.2

842,62839.5

843,93742.0

930,15143.6

1,650,825

82.2

1,772,780

83.1

GU operations

246,091

12.3

249,438

11.7

Global Brands operations

109,633

5.5

108,204

5.1

2,295

0.1

2,569

0.1

2,008,846

100.0

2,132,992

100.0

Total sales of UNIQLO Japan
Franchise-related income &alteration charges
Total UNIQLO Japan operations
UNIQLO International operations
Total UNIQLO operations

Other operations
Total(Notes) 1. “Franchise-related income” refers to the proceeds from garment sales to franchise stores and royalty income. “Alteration
charges” refers to income generated from embroidery prints and alterations to the length of pants.
2. “UNIQLO operations” covers the selling of UNIQLO brand casual clothing.
3. “GU operations” covers the selling of GU brand casual clothing.
4. “Global Brands operations” consists of Theory operations (selling of the Theory and other brands clothing), PLST
operations (selling of the PLST and other brands clothing), COMPTOIR DES COTONNIERS operations (selling of the
COMPTOIR DES COTONNIERS and other brands clothing), PRINCESSE TAM. TAM operations (selling of the
PRINCESSE TAM. TAM and other brands clothing), and J Brand operations (selling of the J Brand and other brands
clothing). J Brand Inc. has been excluded from the Fast Retailing Group consolidated scope following the completion of
corporate liquidation proceedings on August 5, 2021.
5. “Other operations” includes the real estate leasing business, etc.
6. E-commerce revenue from UNIQLO Japan
Fiscal year ended 31 August 2020: 107,616 million yen;
Fiscal year ended 31 August 2021: 126,921 million yen.
7. The above amounts do not include consumption taxes, etc.

－

26 －

(b) Sales per unit
Summary

Year ended
31 August 2021
(From 1 September 2020 to
31 August 2021)

Year-on-year change (%)

1,616,053 million yen

106.9

2,598,683 m2

103.1

621 thousand yen

100.6

98,010 persons

96.4

16,488 thousand yen

115.9

Revenue
Sales floor area (average)

Sales per m2

Sales per m2 (yearly)
Number of employees (average)

Sales per employee

Sales per employee (yearly)(Notes) 1. These figures are solely for UNIQLO Japan operations and UNIQLO International operations.
2. Sales figures indicate store sales, and do not include internet sales, products supplied to franchise stores, management andadministrative fees, or alteration charges.
3. “Sales floor area (average)” is calculated based on the number of months each store is in operation.
4. “Number of employees (average)” includes junior employees, part-time workers, contract workers, or temporary staff
seconded from other companies, but does not include operating officers. The number of junior employees and part-timeworkers is stated at the average number of registered personnel.
5. The above figures do not include consumption tax, etc.
(c) Purchases
Year ended 31 August 2021
(From 1 September 2020 to 31 August 2021)
By product category
Purchases(Millions of yen)

Year-on-yearchange(%)

Percentage of total(%)

Men’s clothing

176,121

96.9

17.0

Women’s clothing

183,627

93.2

17.7

Children’s & babies’ clothing

37,032

114.3

3.6

Goods and other items

29,890136.5

2.9

426,672

98.6

41.2

437,605

100.9

42.2

864,277

99.7

83.4

GU operations

134,092

105.1

12.9

Global Brands operations

38,004

83.2

3.7

1,036,375

99.7

100.0

Total UNIQLO Japan operations
UNIQLO International operations
Total UNIQLO operations

Total(Notes) 1. “UNIQLO operations” covers the selling of UNIQLO brand casual clothing.
2. “GU operations” covers the selling of GU brand casual clothing.
3. “Global Brands operations” consists of Theory operations (selling of the Theory and other brands clothing), PLST
operations (selling of the PLST and other brands clothing), COMPTOIR DES COTONNIERS operations (selling of the
COMPTOIR DES COTONNIERS and other brands clothing), PRINCESSE TAM. TAM operations (selling of the
PRINCESSE TAM. TAM and other brands clothing), and J Brand operations (selling of the J Brand and other bands
clothing). J Brand Inc. has been excluded from the Fast Retailing Group consolidated scope following the completion of
corporate liquidation proceedings on 5 August 2021.
4. There are businesses other than the above, mainly real estate leasing, but they do not involve purchasing due to the nature of
the activity.
5. The above figures do not include consumption tax.
－

27 －(3) Consideration of Performance Conditions on Management’s Perspective(a) Significant accounting policies and estimations
The Group’s consolidated financial statements were prepared in accordance with IFRS. Accounting estimates are necessary forthe preparation of consolidated financial statements, so when judging the recoverability of impaired non-financial assets ordeferred tax assets, etc., estimates are either made based on past performance, or based on assumptions that are judged to bereasonable under the circumstances. Please see “9. Financial Information (6) Notes to the consolidated financial statements” fordetails.
(b) Analysis of management performance for the year ended 31 August 2021
Please see "C. Management’s Discussion and Analysis of Consolidated Financial Condition, Results of Operations and Cash
Flows (1) Summary of Business Results" for analysis of management performance.
(c) Sources of funding and analysis of fund liquidity(i) Basic Approach to Financial Strategy
For the Group, the guiding principle behind the financial strategy is to maximize free cash flow through the Group's businessactivities while maintaining a strong financial standing, and also to ensure investment capital for growth, and on-hand liquidity,
while preserving a certain level of shareholder returns for each fiscal year.
In order to maintain a strong financial standing, we will ensure adequate on-hand liquidity to enable us to withstand the unexpected,
such as inclement weather and COVID-19, while continuing to adhere to the principle of funding investment capital through ouroperating cash flows. In addition, we will also ensure stable external funding.
(ii) Cash Flow and Liquidity Information
As a feature of apparel retailing industry, the Group is committed to ensuring on-hand liquidity of three to five months' worth ofsales in order to prepare for unexpected circumstances on working capital or inclement weather. Cash and cash equivalents
amount to 1.1777 trillion yen at the end of the consolidated fiscal year under review, against revenue of 2.1329 trillion yen forthe consolidated fiscal year under review. However, we believe the current on-hand liquidity of 4 months' worth of sales at 1
trillion yen is adequate against our plan to exceed 3 trillion yen in revenue throughout all of the Group's businesses in the near
future.
(iii) Key Details of Funding Needs
In terms of capital expenditure used in operating activities, the Group's funding needs include stock, logistics, advertising andpromotion, rental expenses (rent for stores, etc.), and labor costs.
In addition, capital expenditure for investment activities includes investing in logistics warehouses and IT investments (selfcheckouts in-store, investments in e-commerce and supply-chain-related systems) to promote the Ariake Project, in addition to
store-related investments (opening new stores and renovating existing stores). For the fiscal year ending August 2022, across thewhole Group we plan to invest 34.3 billion yen in launching new stores, and 61.7 billion yen of capital investment in otherinvestments such as warehousing and IT (detailed in "(1) Important new facilities," in "C. Plans for new facility construction, old
facility removal" under "5. Capital Expenditures").
(iv) Funding
In order to stably and swiftly secure the funds required to maintain and expand the Group's businesses, we are striving tomaximize free cash flow through our business activities while also making effective use of internal and external funds.
To maintain a strong financial standing, we are funding investment capital through our operating cash flow in principle.
However, we also plan to diversify our funding and improve capital efficiency, and also make use of some corporate bonds toraise capital. In June 2018, we raised 250 billion yen using corporate bonds, which is being invested in expanding our overseas
business and promoting the Ariake Project, as well as being allocated for corporate bond redemptions.
Recognizing that sustaining and improving stable external funding is an important management issue, the Group has obtained
S&P (Standard & Poor's) and JCR (Japan Credit Rating Agency) ratings. At the time of publishing, our S&P rating is"A" (stable) and our JCR rating is "AA" (stable). We also maintain good business relationships with key financial institutions.
During the consolidated fiscal year under review, sales and profits increased. Performance has improved compared to the previous
fiscal year, which was significantly affected by the spread of COVID-19. Thanks to the tremendous support from our business
partners, the continuation of our sales activities after improving infection-prevention measures, and reduction of our costs anduse of inventories. Going forward, we will continue to maintain a strong financial standing and endeavor to sustain and improvestable external funding, while remaining vigilant to changes in the business environment that may arise due to COVID-19.
－

28 －D. Major Contracts
Not applicable.
E. Research and Development
Not applicable.

－

29 －

5. Capital Expenditures
A. Capital Expenditures
UNIQLO Japan opened 38 new stores. UNIQLO International opened 85 stores in the Greater China, 2 in South Korea, 3 inSingapore, 3 in Malaysia, 4 in Thailand, 5 in the Philippines, 8 in Indonesia, 2 in Australia, 4 in Vietnam, 3 in India, 1 in the USA,
2 in Canada, 1 in France, 3 in Russia, 1 in Germany, 1 in Belgium, 1 in Spain, 1 in Sweden and 1 in the Netherlands. GU opened 21
new stores. In addition, Global Brands opened 37 new stores.
As a result, the Group’s capital expenditure increased by 17.9 billion yen year-on-year in fiscal 2021 to 100.6 billion yen. That
figure can be broken down into 15.7 billion yen for UNIQLO Japan, 38.5 billion for UNIQLO International, 3.8 billion yen for GU,
1.8 billion yen for Global Brands, and 40.7 billion yen for systems, etc. While investment in new store openings declined comparedto the previous year in which we opened many global flagship stores and large-format stores, we did increase our investment inglobal automated warehousing as part of our transformative Ariake Project.
The above figures do not include consumption tax, etc. In addition, the investments in right-of-use assets relating to lease payments
are not included.
B. Important Facilities
As at 31 August 2021, the Group’s important facilities were shown as below:(1) Information about the Reporting Entity
Area (m2)Company name

Type of facility

Location
Land

FAST RETAILING
CO., LTD.

Capital expenditure (Millions of yen)

Head office

Yamaguchi City,
Yamaguchi
Prefecture

Commercial
establishments

Chuo-ku, Fukuoka
City, etc.

OthersLand

Buildings

Right-ofuse assets

Deposits /Guarantees

Others

Total

Number of
employees

95,255.83

1,047

734

-

-

134

1,917

60

-

-

26

1,758

1,309

2,163

5,258

-

29,308.87

76

19,392

102,589

4,892

2,649

129,601

1,557(2) Subsidiaries in Japan
Area (m2)Company name

Type of facility

Location
Land

G.U. CO., LTD.

Yamaguchi City,
Yamaguchi
Prefecture etc.

Land

Buildings

Right-ofuse assets

Deposits /Guarantees

Others

Total

Number of
employees

2,591.06

450

15,793

79,66728,894

1,747

126,553

9,642

UNIQLO Japan, other

19,960.76

353

3,974

23,058449

10,12737,964

3,830

Total for UNIQLO Japan

22,551.82

803

19,768102,726

29,343

11,875

164,517

13,472--

10,731

18,0958,553

516

37,897

4,462

-

-

185

330

194

8

718

871

-

-

646

1,177

918

66

2,808

760

－

30 －

Stores in Japan, etc.
UNIQLO CO., LTD.

Capital expenditure (Millions of yen)Stores in Japan, etc.

LINK THEORY

Yamaguchi City,
Yamaguchi
Prefecture, etc.
Yamaguchi City,

JAPANCO., LTD.

Stores in Japan, etc.

PLST CO., LTD.

Stores in Japan, etc.

Yamaguchi
Prefecture, etc.
Yamaguchi City,
Yamaguchi
Prefecture, etc.

(3) Overseas subsidiaries
Area (m2)Company name

Type of facility

Capital expenditure (Millions of yen)

Location
Land

Land

Buildings

Right-ofuse assets

Deposits /Guarantees

OthersNumber of
employees

Total

FAST RETAILING(CHINA) TRADING
CO., LTDUNIQLOInternational store,
etc.

Shanghai, PRC--

19,349

9,908

4,091

10,82344,172

12,636UNIQLO TRADING
CO., LTD.

UNIQLOInternational store,
etc.

Shanghai, PRC

-

-

939

2,832

363

354

4,490

758

FAST RETAILING(Shanghai)
TRADING CO., LTD

UNIQLOInternational store,
etc.

Shanghai, PRC

-

-

1,445

2,578

264

353

4,641

395

FRL Korea Co., Ltd.

UNIQLOInternational store,etc.

Seoul, South Korea

-

-

2,439

2,056

3,545

653

8,696

1,357

-

-

-

24

12

-

36

7

FAST RETAILING(SINGAPORE) PTE.
Ltd.

Office, etc.

Republic ofSingapore

UNIQLO(THAILAND)COMPANY
LIMITEDUNIQLOInternational store,etc.

Bangkok,
Kingdom of Thailand

-

-

1,199

1,106

1,020

865

4,191

1,349

PT. Fast RetailingIndonesia

UNIQLOInternational store,
etc.

Jakarta, Indonesia

-

-

1,858

1,946

344

1,109

5,259

1,613

UNIQLO Australia
Pty Ltd.

UNIQLOInternational store,
etc.

Melbourne, Australia

-

-

2,429

12,747

5

5,100

20,282592

Fast Retailing USA,Inc.

Office, etc.

New York, U.S.A.

-

-

4,331

46,832402

6,913

58,480

1,915

UNIQLO EUROPE
LIMITEDUNIQLOInternational store

London, United
Kingdom--

12,53230,270477

3,735

47,0152,408

Ho Chi Minh,
Vietnam

-

-

1,638

872

94

724

3,330

728

UNIQLO VIETNAM
CO., LTDUNIQLOInternational store,
etc.

UNIQLO INDIA
PRIVATE LIMITEDUNIQLOInternational store,etc.

New Delhi,
Republic of India

-

-

1,472

1,252

115

241

3,081

348

GU (Shanghai)
Trading Co., Ltd.

International store,
etc.

Shanghai, PRC

-

-

146

48

59

77

331

104

Fast Retailing France
S.A.S.

Office, etc.

Paris, France

-

-

-

351

30

101

483

275

COMPTOIR DES
COTONNIERS
S.A.S.

International store,
etc.

Paris, France

-

-

238

1,507

363

245

2,356

408

PRINCESSE
TAM.TAM S.A.S.

International store,
etc.

Paris, France

-

-

285

722

162

129

1,299

228

(Notes) 1. When facilities are subleased within the Group, the accompanying documentation is included in the documentation
disclosed to the sublessor.
2. Most items in the “Others” category for the reporting entity are Ariake head office (Koto-ku, Tokyo), Roppongi head office(Minato-ku, Tokyo), the old head office (Ube City, Yamaguchi), lands and buildings for store use subleased to UNIQLO
CO., LTD. and G.U. CO., LTD. by the sublessor company (Chuo-ku, Tokyo and Yokohama City, Kanagawa) and logistics
warehouses (Ibaraki City, Osaka).
3. Monetary amounts are reported at book value. Also, the figures do not include consumption tax, etc.
4. The number of employees does not include operating officers, junior employees, or part-time workers.
5. Assets are not expressed as allocated among business segments.

－

31 －

C. Plans for new facility construction, old facility removal
The following are the important new facility construction and / or facility removal projects planned as at 31 August 2021. In
addition, the investments in right-of-use assets relating to lease payments are not included.
(1) Important new facilities
The capital investment plans (new facility construction, expansion) for each segment in the year ending 31 August 2022 (1September 2021 – 31 August 2022) are as follows.
Capital investment(Millions of yen)Segment

Details of investment
New store openings, warehouses, etc. (approx. 30

UNIQLO Japan

35,092

UNIQLO International

30,776

New store openings, warehouses, etc. (approx.
170 stores)

GU

4,462

New store openings, etc. (approx. 36 stores)

Global Brand Business

2,156

New store openings, etc. (approx. 40 stores)

Others23,488IT-related investments, warehouses, etc.

Total

95,974stores)(Notes) 1. It is expected that the Group will be able to meet its funding needs from equity capital, corporate bonds, borrowings,
finance leases, etc.
2. The above figures do not include consumption tax, etc.
Also, the main new facility plans included in the plans described above are as follows.
Amount of planned
investment
Type offacility

Name ofbusiness

Constructioncommence

Construction
completion

UNIQLO CO.,LTD.

UNIQLOJapan
warehouses

Ibaraki DC
Warehouses

4,791

January2021

November
2021

70,080 Lease Hold

UNIQLO CO.,LTD.

UNIQLOJapan
warehouses

5,734

4,860

August2020

September
2021

33,637 Lease Hold

FAST RETAILING(CHINA)
TRADING CO.,
LTD

China
Beijing914

294

October
2021

November
2021

3,289 Lease Hold

UNIQLO
RivoliFrance
Paris

750

537

August2020

September
2021

2,972 Lease Hold

UNIQLO
Taipei Global
FlagshipStore

TaiwanTaipei

970

339

June
2021

October
2021

3,419 Lease Hold

Total
(Millionsof yen)Amountalready
disbursed(Millionsof yen)

Japan
Osaka

5,640

Kobe DC
Warehouses

Japan
Hyogo

UNIQLOInternational
store

UNIQLOBEIJINGSALITUN

UNIQLOEUROPE
LIMITEDUNIQLOInternational
store

UNIQLO TAIWANLTD.

UNIQLOInternational
store

Company namePlannedsales floorarea /
occupied
warehousearea (m2)Location(Notes) 1. It is expected that the Group will be able to meet its funding needs from equity capital and finance leases.
2. The above figures do not include consumption tax, etc.
3. Assets are not allocated among business segments.
(2) Planned removals of important facilities
There were no planned removals of important facilities as at 31 August 2021.

－

32 －

Reference6. Stock Information and Dividend Policy
A. Stock Information(1) Number of Shares(a) Total number of shares
Type

Total number of authorized shares (shares)

Common stock

300,000,000

Total

300,000,000(b) Shares issued

Type

Shares issued
as at 31 August 2021
(shares)Number of sharesissued as at submission
date (shares)(26 November 2021)

Name of financial
instrument exchangeof listing or authorized
financial instruments
firms association

Details

First section of the Tokyo
Stock Exchange andCommon stock

106,073,656

106,073,656

the Main board of
the Stock Exchange of

100 sharesas one unit

Hong Kong Limited(Note)
Total

106,073,656

106,073,656--(Note) Hong Kong Depositary Receipts (“HDRs”) are listed on the Main Board of the Stock Exchange of Hong Kong Limited.

－

33 －

(2) Share Subscription Rights(a) Details of the Stock Option Program
The Company has instituted a stock option program that grants rights to acquire new shares pursuant to the Companies Act ofJapan. Matters stated below are details of the program current as at the final day of the current fiscal year (31 August 2021).
Details of changes made during the period from the final day of the current fiscal year until the end of the previous month (31October 2021) on the submission date are shown in brackets [ ]. Details of the 12th share subscription rights on the submission
date are stated.
(i) Share subscription rights A type
2nd

3rd

4th

Resolution date

12 October 2011

11 October 2012

Class and number of recipients

Employees of theCompany:
Employees of the Groupsubsidiaries:

Number of stock options (Shares)

2,247 [0]3,157 [2,556]

2,286 [2,286]

Type of shares to be issued upon
exercise of share subscription rights

Common stock

Same as left

Same as left

Number of shares to be issued upon
exercise of share subscription rights(Shares)

2,247 [0]3,157 [2,556]

2,286 [2,286]

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Same as left

Same as left

Exercise period of sharesubscription rights

From 15 November 2014
to 14 November 2021

From 13 November 2015
to 12 November 2022

From 3 December 2016
to 2 December 2023

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 12,499
Paid-in capital: 6,250

Issue price: 15,222
Paid-in capital: 7,611

Issue price: 37,110
Paid-in capital: 18,555

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription
rights shall be forfeited and may
not be exercised.

Same as left

Same as left

Matters pertaining to transfer ofshare subscription rights

Any acquisition of sharesubscription rights by transfer
shall require an authorizing
resolution from the Board of
Directors.

Same as left

Same as left

Matters pertaining to issuing ofshare subscription rights inconjunction with reorganization(Note)

Same as left

Same as left

14

4

－

Employees of theCompany:
Employees of the Groupsubsidiaries:

34 －10 October 201318

8

Employees of theCompany:
Employees of the Groupsubsidiaries:

19

11

5th
Resolution date

9 October 2014

Class and number of recipients

Employees of theCompany:
Employees of the Groupsubsidiaries:

6th

7th

8 October 2015
36

16

Employees of theCompany:
Employees of the Groupsubsidiaries:

13 October 201615

19

Employees of theCompany:
Employees of the Groupsubsidiaries:

Number of stock options (Shares)

8,034 [8,034]941 [941]

1,041 [1,041]

Type of shares to be issued upon
exercise of share subscription rights

Common stock

Same as left

Same as left

Number of shares to be issued upon
exercise of share subscription rights(Shares)

8,034 [8,034]941 [941]

1,041 [1,041]

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Same as left

Same as left

Exercise period of sharesubscription rights

From 14 November 2017
to 13 November 2024

From 13 November 2018
to 12 November 2025

From 11 November 2019
to 10 November 2026

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 42,377
Paid-in capital: 21,188

Issue price: 45,658
Paid-in capital: 22,829

Issue price: 34,684
Paid-in capital: 17,342

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription
rights shall be forfeited and may
not be exercised.

Same as left

Same as left

Matters pertaining to transfer ofshare subscription rights

Any acquisition of sharesubscription rights by transfer
shall require an authorizing
resolution from the Board of
Directors.

Same as left

Same as left

Matters pertaining to issuing ofshare subscription rights inconjunction with reorganization(Note)

Same as left

Same as left

－

35 －

16

23

8th
Resolution date

12 October 2017Class and number of recipients

Employees of theCompany:
Employees of the Groupsubsidiaries:

9th

10th

11 October 201819

27

Employees of theCompany:
Employees of the Groupsubsidiaries:

10 October 201917

32

Employees of theCompany:
Employees of the Groupsubsidiaries:

Number of stock options (Shares)

3,299 [3,299]

3,670 [3,670]

3,231 [3,231]

Type of shares to be issued upon
exercise of share subscription rights

Common stock

Same as left

Same as left

Number of shares to be issued upon
exercise of share subscription rights(Shares)

3,299 [3,299]

3,670 [3,670]

3,231 [3,231]

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Same as left

Same as left

Exercise period of sharesubscription rights

From 10 November 2020
to 9 November 2027

From 9 November 2021
to 8 November 2028

From 8 November 2022
to 7 November 2029

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 37,648
Paid-in capital: 18,824

Issue price: 58,276
Paid-in capital: 29,138

Issue price: 66,059
Paid-in capital: 33,030

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription
rights shall be forfeited and may
not be exercised.

Same as left

Same as left

Matters pertaining to transfer ofshare subscription rights

Any acquisition of sharesubscription rights by transfer
shall require an authorizing
resolution from the Board of
Directors.

Same as left

Same as left

Matters pertaining to issuing ofshare subscription rights inconjunction with reorganization(Note)

Same as left

Same as left

－

36 －

11

46

11th
Resolution date

15 October 2020

Class and number of recipients

Employees of theCompany:
Employees of the Groupsubsidiaries:

12th
14 October 2021
18

47

Employees of theCompany:
Employees of the Groupsubsidiaries:

Number of stock options (Shares)

1,999 [1,973]

2,907

Type of shares to be issued upon
exercise of share subscription rights

Common stock

Same as left

Number of shares to be issued upon
exercise of share subscription rights(Shares)

1,999 [1,973]

2,907

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Same as left

Exercise period of sharesubscription rights

From 13 November 2023
to 12 November 2030

From 12 November 2024
to 11 November 2031

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 77,560
Paid-in capital: 38,780

Issue price: 73,173
Paid-in capital: 36,587

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription
rights shall be forfeited and may
not be exercised.

Same as left

Matters pertaining to transfer ofshare subscription rights

Any acquisition of sharesubscription rights by transfer
shall require an authorizing
resolution from the Board of
Directors.

Same as left

Matters pertaining to issuing ofshare subscription rights inconjunction with reorganization(Note)

Same as left

－

37 －

19

47

(Notes) Upon any reorganization of the Company (collectively referred to as “Reorganization”) consisting of merger (limited to cases
where the Company becomes extinct thereby), absorption-type company split or incorporation-type company split (in each
event, limited to cases where the Company is the entity resulting from the company split), or exchange or transfer of shares (ineach event, limited to cases where the Company becomes a wholly owned subsidiary), parties holding share subscription
rights in existence immediately preceding the effective date of such Reorganization (hereinafter referred to as “Outstanding
Share Subscription Rights”) shall, in each applicable case, be issued share subscription rights for shares of the resulting
company as prescribed in Article 236 (1) viii of the Companies Act of Japan (hereinafter referred to as the “Company
Resulting From Reorganization”). In such event, any Outstanding Share Subscription Rights shall lapse and the Company
Resulting From Reorganization shall issue new share subscription rights; provided, however, that terms and conditions
stipulating that the Company Resulting From Reorganization shall issue share subscription rights that prescribe the mattersstated below shall be included in any absorption merger agreement, new merger agreement, absorption-type company split
agreement, incorporation-type company split plan, share exchange agreement, or transfer of shares plan.
1. Number of share subscription rights to be issued by the Company Resulting From Reorganization:
Each holder of Outstanding Share Subscription Rights shall be issued the same number thereof.
2. Type of shares of the Company Resulting From Reorganization underlying the share subscription rights:
Common stock of the Company Resulting From Reorganization.
3. Number of shares of the Company Resulting From Reorganization underlying the share subscription rights:
A proposal stating the conditions for Reorganization and the like shall include a finalized statement of the type and numberof shares underlying the above-mentioned share subscription rights.
4. Value of property to be incorporated upon exercise of the share subscription rights:
The value of property to be incorporated upon exercise of share subscription rights that are issued shall be the amountobtained by multiplying the exercise price after reorganization prescribed below by the number of shares of the Company
Resulting From Reorganization underlying the share subscription rights that have been finalized as stated in No. 3. above.
The exercise price after Reorganization shall be 1 yen per share of the Company Resulting From Reorganization that can beissued upon exercise of each share subscription right that is issued.
5. Period during which share subscription rights can be exercised:
The period from the later of either the first day of the period during which share subscription rights can be exercised asprescribed above or the day on which a Reorganization takes effect through the final day of the period during which sharesubscription rights can be exercised as prescribed above.
6. Matters pertaining to the increase of capital and capital reserve resulting from the issuance of shares upon exercise of theshare subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.
7. Restrictions on acquisition of share subscription rights by transfer:Any acquisition of share subscription rights by transfer shall require an authorizing resolution from the Board of Directorsof the Company Resulting From Reorganization.
8. Terms and conditions for acquisition of share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.
9. Conditions for exercise of share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.

－

38 －

(ii) Share subscription rights B type
2nd

3rd

4th

Resolution date

12 October 2011

11 October 2012

Class and number of recipients

Employees of theCompany:
Employees of the Groupsubsidiaries:

Number of stock options (Shares)

2,245 [361]4,657 [4,340]

5,290 [5,147]

Type of shares to be issued upon
exercise of share subscription rights

Common stock

Same as left

Same as left

Number of shares to be issued upon
exercise of share subscription rights(Shares)

2,245 [361]4,657 [4,340]

5,290 [5,147]

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Same as left

Same as left

Exercise period of sharesubscription rights

From 15 December 2011
to 14 November 2021

From 13 December 2012
to 12 November 2022

From 3 January 2014
to 2 December 2023

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 12,742
Paid-in capital: 6,371

Issue price: 15,569
Paid-in capital: 7,785

Issue price: 37,515
Paid-in capital: 18,757

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription
rights shall be forfeited and may
not be exercised.

Same as left

Same as left

Matters pertaining to transfer ofshare subscription rights

Any acquisition of sharesubscription rights by transfer
shall require an authorizing
resolution from the Board of
Directors.

Same as left

Same as left

Matters pertaining to issuing ofshare subscription rights inconjunction with reorganization(Note)

Same as left

Same as left

139

584

－

Employees of theCompany:
Employees of the Groupsubsidiaries:

39 －10 October 2013
136

615

Employees of theCompany:
Employees of the Groupsubsidiaries:

180

706

5th
Resolution date

9 October 2014

Class and number of recipients

Employees of theCompany:
Employees of the Groupsubsidiaries:

6th

7th

8 October 2015
223

785

Employees of theCompany:
Employees of the Groupsubsidiaries:

13 October 2016
274

921

Employees of theCompany:
Employees of the Groupsubsidiaries:

Number of stock options (Shares)

7,946 [7,767]

8,088 [7,844]

11,191 [10,986]

Type of shares to be issued upon
exercise of share subscription rights

Common stock

Same as left

Same as left

Number of shares to be issued upon
exercise of share subscription rights(Shares)

7,946 [7,767]

8,088 [7,844]

11,191 [10,986]

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Same as left

Same as left

Exercise period of share subscription
rightsFrom 14 December 2014
to 13 November 2024

From 13 December 2015
to 12 November 2025

From 11 December 2016
to 10 November 2026

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 42,799
Paid-in capital: 21,399

Issue price: 46,148
Paid-in capital: 23,074

Issue price: 35,168
Paid-in capital: 17,584

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription rights
shall be forfeited and may not be
exercised.

Same as left

Same as left

Matters pertaining to transfer of sharesubscription rights

Any acquisition of sharesubscription rights by transfer shallrequire an authorizing resolution
from the Board of Directors.

Same as left

Same as left

Matters pertaining to issuing of sharesubscription rights in conjunction
with reorganization(Note)

Same as left

Same as left

－

40 －

339

1,096

8th
Resolution date

12 October 2017Class and number of recipients

Employees of theCompany:
Employees of theGroup subsidiaries:

9th

10th

11 October 2018
395

1,152

Employees of theCompany:
Employees of theGroup subsidiaries:

10 October 2019
419

1,267

Employees of theCompany:
Employees of theGroup subsidiaries:

Number of stock options (Shares)

19,910 [19,586]

17,458 [17,099]

21,684 [21,075]

Type of shares to be issued upon
exercise of share subscription rights

Common stock

Same as left

Same as left

Number of shares to be issued upon
exercise of share subscription rights(Shares)

19,910 [19,586]

17,458 [17,099]

21,684 [21,075]

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Same as left

Same as left

Exercise period of sharesubscription rights

From 10 December 2017
to 9 November 2027

From 9 December 2018
to 8 November 2028

From 8 December 2019
to 7 November 2029

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 38,133
Paid-in capital: 19,066

Issue price: 58,892
Paid-in capital: 29,446

Issue price: 66,733
Paid-in capital: 33,367

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription
rights shall be forfeited and may
not be exercised.

Same as left

Same as left

Matters pertaining to transfer ofshare subscription rights

Any acquisition of sharesubscription rights by transfer
shall require an authorizing
resolution from the Board of
Directors.

Same as left

Same as left

Matters pertaining to issuing ofshare subscription rights inconjunction with reorganization(Note)

Same as left

Same as left

－

41 －

528

1,389

11th
Resolution date

15 October 2020

Class and number of recipients

Employees of theCompany:
Employees of theGroup subsidiaries:

12th
14 October 2021
Employees of theCompany:
Employees of theGroup subsidiaries:

694

1,435

Number of stock options (Shares)

15,878 [15,184]

30,757

Type of shares to be issued upon
exercise of share subscription rights

Common stock

Same as left

Number of shares to be issued upon
exercise of share subscription rights(Shares)

15,878 [15,184]

30,757

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Same as left

Exercise period of sharesubscription rights

From 13 December 2020
to 12 November 2030

From 12 December 2021
to 11 November 2031

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 78,237
Paid-in capital: 39,119

Issue price: 73,849
Paid-in capital: 36,925

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription
rights shall be forfeited and may
not be exercised.

Same as left

Matters pertaining to transfer ofshare subscription rightsAnyacquisitionofsharesubscription rights by transfer
shall require an authorizing
resolution from the Board of
Directors.

Same as left

Matters pertaining to issuing ofshare subscription rights inconjunction with reorganization(Note)

Same as left

－

42 －

736

1,521

(Notes) Upon any reorganization of the Company (collectively referred to as “Reorganization”) consisting of merger (limited to cases
where the Company becomes extinct thereby), absorption-type company split or incorporation-type company split (in each
event, limited to cases where the Company is the entity resulting from the company split), or exchange or transfer of shares (ineach event, limited to cases where the Company becomes a wholly owned subsidiary), parties holding share subscription
rights in existence immediately preceding the effective date of such Reorganization (hereinafter referred to as “Outstanding
Share Subscription Rights”) shall, in each applicable case, be issued share subscription rights for shares of the resulting
company as prescribed in Article 236 (1) viii of the Companies Act of Japan (hereinafter referred to as the “Company
Resulting From Reorganization”). In such event, any Outstanding Share Subscription Rights shall lapse and the Company
Resulting From Reorganization shall issue new share subscription rights; provided, however, that terms and conditions
stipulating that the Company Resulting From Reorganization shall issue share subscription rights that prescribe the mattersstated below shall be included in any absorption merger agreement, new merger agreement, absorption-type company split
agreement, incorporation-type company split plan, share exchange agreement, or transfer of shares plan.
1. Number of share subscription rights to be issued by the Company Resulting From Reorganization:
Each holder of Outstanding Share Subscription Rights shall be issued the same number thereof.
2. Type of shares of the Company Resulting From Reorganization underlying the share subscription rights:
Common stock of the Company Resulting From Reorganization.
3. Number of shares of the Company Resulting From Reorganization underlying the share subscription rights:
A proposal stating the conditions for Reorganization and the like shall include a finalized statement of the type and numberof shares underlying the above-mentioned share subscription rights.
4. Value of property to be incorporated upon exercise of the share subscription rights:
The value of property to be incorporated upon exercise of share subscription rights that are issued shall be the amountobtained by multiplying the exercise price after reorganization prescribed below by the number of shares of the Company
Resulting From Reorganization underlying the share subscription rights that have been finalized as stated in No. 3. above.
The exercise price after Reorganization shall be 1 yen per share of the Company Resulting From Reorganization that can beissued upon exercise of each share subscription right that is issued.
5. Period during which share subscription rights can be exercised:
The period from the later of either the first day of the period during which share subscription rights can be exercised asprescribed above or the day on which a Reorganization takes effect through the final day of the period during which sharesubscription rights can be exercised as prescribed above.
6. Matters pertaining to the increase of capital and capital reserve resulting from the issuance of shares upon exercise of theshare subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.
7. Restrictions on acquisition of share subscription rights by transfer:Any acquisition of share subscription rights by transfer shall require an authorizing resolution from the Board of Directorsof the Company Resulting From Reorganization.
8. Terms and conditions for acquisition of share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.
9. Conditions for exercise of share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.

－

43 －

(iii) Share subscription rights C type
9th

10th

11th

Resolution date

11 October 2018

10 October 2019

Class and number of recipients

Employees of theCompany:

Number of stock options (Shares)

4,045 [3,939]

3,380 [3,292]

3,690 [3,690]

Type of shares to be issued upon
exercise of share subscription rights

Common stock

Same as left

Same as left

Number of shares to be issued upon
exercise of share subscription rights(Shares)

4,045 [3,939]

3,380 [3,292]

3,690 [3,690]

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Same as left

Same as left

Exercise period of sharesubscription rights

9 November 2021

8 November 2022

13 November 2023

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 59,764
Paid-in capital: 29,882

Issue price: 67,685
Paid-in capital: 33,843

Issue price: 79,193
Paid-in capital: 39,597

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription
rights shall be forfeited and may
not be exercised.

Same as left

Same as left

Matters pertaining to transfer ofshare subscription rights

Any acquisition of sharesubscription rights by transfer
shall require an authorizing
resolution from the Board of
Directors.

Same as left

Same as left

Matters pertaining to issuing ofshare subscription rights inconjunction with reorganization(Note)

Same as left

Same as left

40－

Employees of theCompany:

44 －15 October 202040

Employees of theCompany:

41

12th
Resolution date

14 October 2021

Class and number of recipients

Employees of theCompany:

Number of stock options (Shares)

3,108Type of shares to be issued upon
exercise of share subscription rights

Common stock

Number of shares to be issued upon
exercise of share subscription rights(Shares)

3,108

Amount to be paid upon exercise ofshare subscription rights (Yen)

Number of shares allocated times¥1 exercise price per share for all
shares to be obtained throughexercise of the share subscription
rights.

Exercise period of sharesubscription rights

12 November 2024

Fair value on the grant date andamount of paid-in capital per shareupon exercise of share subscription
rights (Yen)

Issue price: 74,804
Paid-in capital: 37,402

Exercise conditions of sharesubscription rights

If a holder of share subscription
rights waives the right to acquire
shares, the share subscription
rights shall be forfeited and may
not be exercised.

Matters pertaining to transfer ofshare subscription rights

Any acquisition of sharesubscription rights by transfer
shall require an authorizing
resolution from the Board of
Directors.

Matters pertaining to issuing ofshare subscription rights inconjunction with reorganization(Note)

39

－

45 －

(Notes) Upon any reorganization of the Company (collectively referred to as “Reorganization”) consisting of merger (limited to cases
where the Company becomes extinct thereby), absorption-type company split or incorporation-type company split (in each
event, limited to cases where the Company is the entity resulting from the company split), or exchange or transfer of shares (ineach event, limited to cases where the Company becomes a wholly owned subsidiary), parties holding share subscription
rights in existence immediately preceding the effective date of such Reorganization (hereinafter referred to as “Outstanding
Share Subscription Rights”) shall, in each applicable case, be issued share subscription rights for shares of the resulting
company as prescribed in Article 236 (1) viii of the Companies Act of Japan (hereinafter referred to as the “Company
Resulting From Reorganization”). In such event, any Outstanding Share Subscription Rights shall lapse and the Company
Resulting From Reorganization shall issue new share subscription rights; provided, however, that terms and conditions
stipulating that the Company Resulting From Reorganization shall issue share subscription rights that prescribe the mattersstated below shall be included in any absorption merger agreement, new merger agreement, absorption-type company split
agreement, incorporation-type company split plan, share exchange agreement, or transfer of shares plan.
1. Number of share subscription rights to be issued by the Company Resulting From Reorganization:
Each holder of Outstanding Share Subscription Rights shall be issued the same number thereof.
2. Type of shares of the Company Resulting From Reorganization underlying the share subscription rights:
Common stock of the Company Resulting From Reorganization.
3. Number of shares of the Company Resulting From Reorganization underlying the share subscription rights:
A proposal stating the conditions for Reorganization and the like shall include a finalized statement of the type and numberof shares underlying the above-mentioned share subscription rights.
4. Value of property to be incorporated upon exercise of the share subscription rights:
The value of property to be incorporated upon exercise of share subscription rights that are issued shall be the amountobtained by multiplying the exercise price after reorganization prescribed below by the number of shares of the Company
Resulting From Reorganization underlying the share subscription rights that have been finalized as stated in No. 3. above.
The exercise price after Reorganization shall be 1 yen per share of the Company Resulting From Reorganization that can beissued upon exercise of each share subscription right that is issued.
5. Period during which share subscription rights can be exercised:
The period from the later of either the day on which share subscription rights can be exercised as prescribed above or the
day on which a Reorganization takes effect.
6. Matters pertaining to the increase of capital and capital reserve resulting from the issuance of shares upon exercise of theshare subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.
7. Restrictions on acquisition of share subscription rights by transfer:Any acquisition of share subscription rights by transfer shall require an authorizing resolution from the Board of Directorsof the Company Resulting From Reorganization.
8. Terms and conditions for acquisition of share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.
9. Conditions for exercise of share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.
(b) Content of Rights Plan
Not applicable.
(c) Other Share Subscription Rights
Not applicable.

－

46 －

(3) Exercise of convertible bonds with conditional permission for adjustment of exercise priceNot applicable.
(4) Change in Total Number of Shares Issued, Capital Stock

Date

Increase /decrease in total
number ofsharesissued (Shares)

Balance of total
number ofshares issued(Shares)

Increase /decreasein capital stock(Millions ofyen)

Balance ofcapital stock(Millions ofyen)

Increase /decreasein capitalreserve(Millions ofyen)

Balance ofcapital reserve(Millions ofyen)-

106,073,656

7,000

10,273(7,000)4,578

31 August 2004

(Note) This represents an addition to capital stock from capital reserve approved by resolution at a special meeting of the Board of
Directors on 30 August 2004.
(5) Status by Type of Holder
As at 31 August 2021
Shares (One unit = 100 shares)
Class

Government,
municipal
entities

Number ofshareholders (persons)Foreign corporations, etc.

Financial
institutions

Traders offinancial
products

Other
corporations

-

65

57

Number of shares held
(trading units)-359,594

Percentage of shares
held (%)-

33.93

Individuals &others

Total

Sharesless than
one unit(shares)

Excl.
individuals

Individuals

172

823

10

6,057

7,184

-

23,39185,303

197,495

13

394,126

1,059,922

81,456

2.21

8.05

18.63

0.00

37.18

100.00-(Notes) 1. The 3,928,985 shares of treasury stock include 39,289 units of shares held by individuals and others and 85 shares held byindividuals and others of less than one unit.
2. Figures shown in the columns “Other corporations” and “Shares less than one unit” include 27 units of shares and 84
shares, respectively, in the name of Japan Securities Depository Center, Inc.

－

47 －

(6) Major Shareholders

Name or trade name

Address

Number ofshares held(Thousandshares)

As at 31 August 2021
Percentage of
total number ofshares issued(%)

Tadashi Yanai

Shibuya-ku, Tokyo

22,037

21.57

The Master Trust Bank of Japan, Ltd.

2-11-3 Hamamatsu-cho, Minato-ku,
Tokyo21,262

20.82

Custody Bank of Japan, Ltd.

1-8-11 Harumi, Chuo-ku, Tokyo

13,808

13.52

5,310

5.20

TTY Management B.V.

De Entree 99, 1101HE Amsterdam,
The Netherlands

Kazumi Yanai

New York, U.S.A.

4,781

4.68

Koji Yanai

Shibuya-ku, Tokyo

4,781

4.68

Fight & Step Co., Ltd.

1-4-3 Mita, Meguro-ku, Tokyo

4,750

4.65

MASTERMIND, LLC

1-4-3 Mita, Meguro-ku, Tokyo

3,610

3.53

Teruyo Yanai

Shibuya-ku, Tokyo

2,327

2.28

JP Morgan Chase Bank

5JP E14, 25 Bank Street, Canary Wharf,
London, England

2,190

2.14

84,856

83.07(Standing proxy Mizuho Bank, Ltd.)(2-15-1, Konan, Minato-ku, Tokyo)

Total

-

(Notes) 1. “Number of shares held” is rounded down to the nearest unit of thousand shares.
2. The shares held by The Master Trust Bank of Japan, Ltd. and Custody Bank of Japan, Ltd. are all held in conjunction withtrust business.
3. According to the report of large shareholdings (report of change of composition) submitted on 15 December 2020 by
Nomura Securities Co., Ltd. and NOMURA INTERNATIONAL PLC, and Nomura Asset Management Co., Ltd., which are
all as joint holders, each party was holding the shares stated below as at 8 December 2020. However, since the Company
has not been able to confirm the number of shares actually held as at 31 August 2021, of the end of the term, theseshareholdings have not been included in the statement of principal shareholders above.
Number ofPercentage ofshares held
total number ofName or trade name
Address(Thousandshares issued
shares)(%)
Nomura Securities Co., Ltd.

1-13-1 Nihonbashi, Chuo-ku, Tokyo

73

0.07

NOMURA INTERNATIONAL PLC

1 Angel Lane, London EC4R 3AB, United
Kingdom

41

0.04

Nomura Asset Management Co., Ltd.

2-2-1 Toyosu, Koto-ku, Tokyo

11,81211.14

4. In addition to the above, 3,928,985 shares of treasury stock are held by the Company (3.70% of the total number ofauthorized shares).

－

48 －

(7) Voting Rights(a) Shares issued
As at 31 August 2021
Number of shares(Shares)Number of voting rights(Number)

Details

Non-voting shares

-

-

-

Shares subject to restrictions on voting rights(treasury stock, etc.)

-

-

-

Shares subject to restrictions on voting rights(others)

-

-

-

-

-

Class

(Shares held as
Shares with full voting rights(treasury stock, etc.)

treasury stock)
Common stock
3,928,900
Common stock

Shares with full voting rights (others)

1,020,633

102,063,300(Note 1)

Common stock
81,456-(Notes 1, 2)

Total number of shares issued

106,073,656--

Total number of voting rights of allshareholders-

Shares less than one unit

1,020,633-(Notes) 1. The columns for the number of shares of “Shares with full voting rights (others)” and “Shares less than one unit” include,
2,700 shares and 84 shares, respectively, held in the name of Japan Securities Depository Center, Inc.
2. Common stock in the “Shares less than one unit” column includes 85 shares of treasury stock held by the Company.
(b) Treasury StockAs at 31 August 2021
Name or trade name ofholderFAST RETAILING
CO., LTD.
Total

Holder’s address

10717-1 Sayama,
Yamaguchi-City,

Number ofshares held in
own name(Shares)Number ofshares held inother’s name(Shares)

Total number ofshares held
(Shares)

Percentage of
total number ofshares issued(%)

3,928,900-

3,928,900

3.70

3,928,900-

3,928,900

3.70

Yamaguchi
-

－

49 －

B. Treasury Stock Information
Type of Shares: Buybacks of common stock under Companies Act of Japan, Article 155-7(1) Purchases approved by General Meeting of Shareholders
Not applicable.
(2) Purchases approved by Board of Directors
Not applicable.
(3) Details of items not based on General Meeting of Shareholders or Board of Directors’ resolutions
Purchases of shares less than one unit pursuant to Companies Act of Japan, Article 192-1.
Number of shares(Shares)

Total paid
(Thousand yen)

Treasury stock purchased in the fiscal year ended 31 August 2021

160

12,775

Treasury stock purchased from 1 September 2021 to the submission date

41

3,209

Class

(Note) “Treasury stock purchased from 1 September 2021 to the submission date” does not include shares of less than one unit
purchased between 1 November 2021 and the submission date of this report.
(4) Status of treasury stock purchased
Fiscal year ended 31 August 2021
Class

From 1 September 2021 to thesubmission date
Total disposal
Number of shares
value(Shares)(Thousands of yen)

Number of shares(Shares)

Total disposal
value(Thousands of yen)

-

-

-

-

-

-

-

-

-

-

-

-

44,288

168,694

7,636

29,104

3,928,985-

3,921,390-

Treasury stock purchases for which
subscribers were solicited
Treasury stock cancelled after purchase
Treasury stock transferred due tomergers, share exchange, shareissuance, or company split
Other (Note)
Number of Treasury shares held

(Note) The breakdown of figures for the year ended 31 August 2021 reflects the exercise of 44,288 share subscription rights, a sharedisposal value of 168,694 thousand yen. The breakdown of figures for the current year reflects the exercise of sharesubscription rights, and does not include shares of less than one unit purchased between 1 November 2021 and the submission
date of this report.

－

50 －

C. Dividend Policy
The Company regards the distribution of profits to all shareholders as one of its most important management issues, and our basic
policy is to constantly improve performance and to continually distribute profits in an appropriate manner based on performance.
Our policy is to pay high dividends based on performance after taking into consideration (i) demand for funds needed to expand
business and improve revenues of the Group and (ii) the financial health of the Group. Our basic policy for dividends from surplus
is to pay two dividends annually, an interim dividend and a year-end dividend. These dividends are decided by the Board of
Directors, unless otherwise stipulated by laws and regulations.
The year-end dividend was 240 yen per share and the interim dividend was 240 yen per share, so the annual dividend was 480 yen
per share, the same amount as for the previous fiscal year. We intend to effectively utilize internal reserves and free cash flow for
financial investment and loans to strengthen the operational base of the Group companies, and we will endeavor to achieve
continual and stable growth.
The payment of an interim dividend under Article 454-5 of the Companies Act of Japan is stipulated by the Company’s Articles ofIncorporation.
Dividends for the current fiscal year are as follows:
Total dividends(Millions of yen)

Dividends per
share
(Yen)

Board of Directors resolution made at the meeting held on 8 April 2021

24,511

240

Board of Directors resolution made at the meeting held on 2 November 2021

24,514240

Resolution date

D. Waiver from compliance with Rule 19B. 21
The Hong Kong Stock Exchange has granted us, subject to certain conditions, a waiver from Rule 19B. 21 of the Hong Kong
Listing Rules regarding certain requirements for cancellation of HDRs upon a share repurchase. The Company has complied withthe relevant conditions in the year ended 31 August 2021.

－

51 －

7. Corporate Governance Report
A. Basic Thinking on Corporate GovernanceAs part of our corporate statement of "Changing clothes. Changing conventional wisdom. Change the world," we aim to expand ourbusiness to become the world's number one apparel information, manufacturing and retail business. In addition, with our aim ofresolving societal and environmental issues, we will contribute to building a better society through creating sustainable businesses
not only for our company, but also throughout our supply chain.
B. Details of Company organization and internal control systems(1) Details of company organization
The Company has built a corporate governance system consisting of a Board of Directors, a Board of Statutory Auditors, andvarious committees. As a key element to strengthen our corporate governance systems, the Company has instituted a system toentrust operating officers (transferring some management authority away from the Board of Directors), to separate management
decision-making from operations performance functions.
Five of the nine members of the Board of Directors are External Directors, with the CEO acting as chairman of the Board of
Directors. The External Directors have an abundance of knowledge and experience in corporate management. As the Company’s
main decision-making body for the performance of management and operations, the Board of Directors meets at least once amonth to discuss and decide upon important management issues. The External Directors all participate actively in Board of
Directors discussions, and offer their opinions without reservations.
The Board of Statutory Auditors consists of five auditors, including three external auditors, with a full-time corporate auditor
acting as chairman. The Standing Statutory Auditor presides. The External Statutory Auditors are fully independent, and they
have ample knowledge and experience as attorneys and certified public accountants. Through their participation in the Board of
Directors, the Statutory Auditors are fully aware of the decision-making process of the Board of Directors, and able to fulfill theirsupervisory obligations. They also supervise the Directors’ performance of their executive duties through regular conversations
with the Directors, other executive officers, other employees, and auditors of subsidiary corporations. The Board of Statutory
Auditors meets at least once a month to make decisions about audit policies and planning. It meets quarterly to receive briefings
and reports from the independent auditor.
The various committees complement the work of the Board of Directors. The External Directors and External Statutory Auditors
also serve as members of these committees. The name, purpose, authority, details of activities, and status of activities of each of
the committees are shown below.
Human Resources Committee
The Human Resources Committee, chaired by external director, discusses important organizational changes and adjustments tohuman resource systems across the Group, and offers views and suggestions to the Board of Directors. The committee met twice
during FY2021.
Sustainability Committee
The Sustainability Committee discusses and determines Fast Retailing’s overall sustainability strategy, environmental protection,social responsibility, response to human rights issues, diversity, and other considerations. The head of the Sustainability Department
chairs the committee and committee members are made up of outside experts, directors, statutory auditors, and executive officers.
The committee met three times during FY2021.
Disclosure Committee
The Disclosure Committee, chaired by the Company official in charge of disclosing information to the Tokyo Stock Exchange(TSE), is tasked with boosting management transparency by “disclosing information that is timely, accurate, fair, and easy tounderstand.” The Committee is responsible for both timely and voluntary disclosures to the TSE and the Stock Exchange of Hong
Kong regarding matters that may materially impact investor and shareholder investment decisions. The committee met 12 times
during FY2021.

－

52 －

IT Investment Committee
The IT Investment Committee debates and advises on the IT investments that will best achieve our targets for sweeping changes
to our information systems and business operations. That means deliberating the efficacy of each individual investment, andreviewing whether IT investment budgets submitted by external specialist organizations are reasonable and appropriate. The IT
Investment Committee is chaired by the President, and the members and observers include outside experts, external directors, andexecutives. The committee met six times during FY2021.
Code of Conduct Committee
The Code of Conduct Committee considers how best to resolve any violations of the Fast Retailing Group Code of Conduct, andwhen to make improvements to it. It offers guidance on educating executives and employees about the requirements of the CoC,
and on operating the confidential hotline. The committee is chaired by the head of the Legal Department, and committee members
include Statutory Auditors (including External Statutory Auditors) and executive officers. The committee met 13 times during
FY2021.
Business Ethics Committee
This committee ensures the Group does not use an advantageous position to exert undue pressure on business counterparts suchas partner factories and suppliers. The committee provides advice and counsel to departments based on external field inspections
and partner company surveys. The committee is chaired by the head of the Sustainability Department, and includes Statutory
Auditors (including External Statutory Auditors) and executive officers. The committee met 11 times during FY2021.
Risk Management Committee
In order to identify latent risks in business activities on a regular basis and to strengthen systems for detecting and managing material
risks, this committee analyzes and assesses the impact and frequency of risks on business, and discusses countermeasures for highrisk business areas to prevent any risk before it occurs or ensure a swift response if a risk does materialize. The committee is chairedby the Group CFO and committee members include outside directors and executive officers. The committee met four times during
FY2021.
Nomination and Remuneration Advisory Committee
With the aim of strengthening Fast Retailing governance, the committee discusses and advises the Board of Directors on
important items relating to Fast Retailing corporate governance, such as the requirements and nomination policy regarding
candidates for director and auditor positions, the policy for determining director remuneration, requirements relating to thecompany’s chief executive officer, and smooth management succession planning. The committee is chaired by a director
nominated by the Board of Directors, and the majority of committee members are independent external executives (both external
directors and external statutory auditors). The committee met twice during FY2021.
Human Rights Committee
Chaired by an outside expert, this committee deliberates and advises on the execution of human rights due diligence. The
committee also provides counselling and conducts education and awareness-raising activities for departments involved in theexecution of business to ensure that we fulfil our obligations to respect human rights under the Fast Retailing Group Human
Rights Policy established in 2018, and conduct business operations appropriately. In addition, the committee is responsible forproviding recommendations and supervision as well as conducting investigations and taking remedial measures when a humanrights violation occurs. The committee met five times during FY2021.

－

53 －

Below is a diagram of our corporate governance system.

－

54 －

The members and chairs of the Board of Directors, Board of Statutory Auditors and other committees are as follows:
Title

Directors

External
Directors

Statutory
Auditors

External
Statutory
Auditors

Human
Code of
Sustainability Disclosure IT Investment
Resources
Conduct
Committee
Committee
Committee
Committee
Committee

Name

Tadashi Yanai

Chairman

Chair

○

○

Chair

TakeshiOkazaki

○

△

○

Chair

○

Kazumi Yanai

○

○
Chair

○

MasaakiShintaku○○

Takashi Nawa○○

Naotake Ono

○

Kathy
Matsui○

Masaaki Shinjo△○

Masumi
Mizusawa△○

Keiko Kaneko

△

○

△

○

○

△

○

△

Kashitani
Masakatsu
Mori

Noriaki
Koyama

△

○

Chair

○

Takao

Nomination
Risk
and
Human
Management Remuneration
RightsCommittee
Advisory
Committee
Committee
Chair

Koji Yanai

○
△

○

○

○

○
○

○
○

△
○

△

△

○
○

○

○
△

○

○

△

○

○

○

ShuichiNakajima○

Takahiro
Wakabayashi

○

○

○

○

○
○

○

○

Takao
Kuwahara○○

Hidetsugu
Asada

○

○

MakotoHoketsu
Yukihiro Nitta

Executive
Directors

Business
EthicsCommittee

Nobumichi
HattoriJohn C Jay

SeniorExecutive
Directors

Board of
Statutory
Auditors

Board ofDirectors

○
○

○
○

Shimpei Otani○

Takahiro
Tambara○Dai Tanaka○

Yasuyuki
Terashi

Chair

○

○

Xiaozhou○Wang
Miyuki Isozaki○

Hiroyuki
Uchida

○

－

55 －

○

TitleSubsidiary
Auditors

Name

Board ofDirectors

Board of
Statutory
Auditors

Human
Code of
Sustainability Disclosure IT Investment
Resources
Conduct
Committee
Committee
Committee
Committee
Committee

Toshiharu
Ura
Kiyomi
Iwamura○GeneralManagerof Legal Dept.

○

GeneralManagerof Public
Relations
Division

○

Chair

○

○

○

△

Division(Uniqlo)
GeneralManager of
Production
Division(GU)△

GeneralManager of
President’s
Office△GeneralManager of IR○△

Legal Manager
Kenji
Shiratsuchi
External
Experts

Nomination
Risk
and
Human
Management Remuneration
RightsCommittee
Advisory
Committee
Committee○

GeneralManager of
Production
Chairpersonsof InternalCommittee

Business
EthicsCommittee

△

Toru

△

Murayama
Yoshinori
TomitaChair(Note) ○: Member △: Non-member attendee (including observers)(2) Outline of External Director’s limited liability agreements
The Company has entered into agreements with the External Directors, External Statutory Auditors, and Independent Auditor,
limiting their liabilities based on provisions in Article 427, Paragraph 1 of the Companies Act, which limits the liabilities fordamages as provided for in Article 423, Paragraph 1 of the Companies Act.
These agreements state that liabilities for damages shall be limited to the higher amount of either 5 million yen or the amountstipulated by law. For Deloitte Touche Tohmatsu LLC, the limit of liabilities for damages shall be limited to the highest of thefollowing amounts multiplied by two: the total economic benefits received or to be received from the Company as remunerationand payment received for performance of duties in each business year during its service as the Independent Auditor.
(3) Summary of Indemnity Liability Insurance Contract for Executive Officers, etc.
Fast Retailing forms an indemnity liability insurance contract for executive and other officers with an insurance company asprescribed in Article 430, Paragraph 3, Item 1 of the Company’s Act. Any damages suffered through damage claims originatingfrom action taken by insured parties based on his/her corporate position will be compensated under this aforementioned insurance
contract, which is renewed on an annual basis. However, there are some exemptions to the contract that mean damages would not
be compensated if the insured persons profited illegally or acquired some benefit or if the damages were caused by a criminal act,
malpractice, or fraud, etc.
The insured persons under the insurance contract include officers in charge of major business execution, such as directors,
statutory auditors, and executive officers of the Group. The insured persons do not have to pay the insurance premiums.
We plan to renew the insurance contract with the same content when it next comes up for renewal.

－

56 －

(4) Establishing internal control systems
The Company seeks to ensure its business operations are legitimate, fair, and efficient by establishing a system of internal
controls that covers the entire Fast Retailing Group (FR Group) and which adheres strictly to the Group’s policies and rules,
including the Group’s management principles, the Fast Retailing Way (FR Way), and the Fast Retailing Group Code of Conduct(FR Code of Conduct).
(a) Ensuring FR Group Directors’ Duties Comply with Laws, Regulations, and Articles of Incorporation
1. Directors and Group officers (collectively, Directors) of all FR Group companies comply faithfully with the Group’s
management principles, the FR Way, the FR Code of Conduct, and other internal Company rules and regulations, andpromote strict adherence to corporate ethics and compliance across the Group as a whole. The Directors also ensure theeffectiveness of the Company’s rules and principles by reviewing them regularly and revising them when necessary toreflect changes in society and Company business activities, and the operation of the FR Code of Conduct.
2. The Company appoints either the Group officer overseeing the Legal Department or the head of the Legal Department as
the compliance officer, tasked with establishing Company and Group-wide compliance frameworks and resolving
compliance-related issues.
3. The Company promotes fairness and transparency in senior management decision-making by appointing two or more
External Directors to the Board of Directors. Statutory Auditors for the Company or Group subsidiaries may attend theBoard of Directors meetings of companies they audit and express timely opinions. Company or Group subsidiary Directors
may engage external lawyers, certified public accountants, etc. to avoid potential violation of laws and implement
preventive measures. If Company or Group subsidiary Directors discover another Director has acted illegally, they must
report immediately to the Statutory Auditors, the President, and the compliance officer.
(b) Ensuring FR Group Employees’ Duties Comply with Laws, Regulations, and Articles of Incorporation
1. Company and Group subsidiary Directors are responsible for establishing a framework to ensure that all Group employees
comply with the management principles, the FR Way, the FR Code of Conduct, and other internal company rules. They arealso responsible for training employees in compliance awareness.
2. The Company has an Internal Audit Department that supervises the FR Group’s internal control systems, and a Legal
Department that oversees compliance.
3. If Directors of the Company or Group subsidiaries discover a legal or compliance violation, they should report the matter
immediately to other Directors. Any serious legal violation should be reported immediately to the Statutory Auditors, thePresident, and the compliance officer.
4. The Company has set up an internal reporting system (hotline) for Directors and employees of the Company or Groupsubsidiaries to report illegal actions or compliance violations.
5. The Code of Conduct Committee, which includes external specialists such as lawyers and certified public accountants,
conducts regular reviews of compliance maintenance and hotline operation, and makes necessary improvements. If
Directors of the Company or Group subsidiaries detect a problem with the hotline operation, they should apply to the Codeof Conduct Committee and request improvements.

－

57 －

(c) Data Storage and Management Relating to Execution of FR Group Directors’ Duties
The documents listed below relating to Company and Group subsidiary Directors’ duties are retained as proof of decision
making and business-execution processes, as stipulated by law, Articles of Incorporation, and Board of Directors andCompany regulations and guidelines on document management and confidential information. These documents are stored andmanaged appropriately and can be easily retrieved for reference or inspection during the legally required storage period.
•

Shareholders’ meeting minutes and relevant documentation•

Board meeting minutes and relevant documentation•

Minutes of important meetings held by Directors and relevant documentation•

Minutes of meetings held by other important employees and relevant documentation(d) Managing Risk of Losses to FR Group
1. The Company regularly analyzes risks relating to the Company and Group subsidiaries to identify risks that could, directly
or indirectly, cause financial loss, interrupt or stop business, damage brand images or the credibility of the Company or FR
Group, and manages any risks accordingly.
2. If unforeseen circumstances should arise, a task force headed by the President or a Director appointed by the President shallbe established to prevent increased losses and minimize damage. For a faster response, the task force may organize an
external advisory team including lawyers and certified public accountants.
(e) Ensuring Efficient Execution of Director Duties
1. To ensure that the duties of the Company and Group subsidiary Directors are performed efficiently, the Company holds
regular monthly meetings of the Board of Directors, which includes a number of External Directors, and holds ad hoc
meetings when necessary. Group subsidiaries which have their own Board of Directors also hold Board meetings as
stipulated by law.
2. Important matters concerning Company and Group management policy and management strategy shall be discussed
beforehand at the weekly management meeting (Monday meeting) chaired by the President, and decisions made after due
deliberation.
3. The execution of decisions made by the Board of Directors shall be conducted efficiently and appropriately by the operating
officers designated by the Board.
(f) Ensuring Reliable FR Group Financial Reports
Systems have been established to ensure reliable financial reporting of Company and FR Group subsidiary activities, and theappropriate acquisition, holding, and disposal of assets. These activities are closely monitored. The Company has alsoestablished a Disclosure Committee to ensure the Company and Group subsidiaries disclose information in a timely andappropriate fashion.

－

58 －

(g) Ensuring Proper Execution of Corporate Groups Formed by Company and FR Group Subsidiaries
1. To ensure appropriate operations of FR Group companies, all Group companies are required to uphold the management
principles, the FR Way, and the FR Code of Conduct. These principles also underpin the rules and regulations used whenestablishing entrusted individual Group companies. While respecting their autonomy, the Company oversees affiliatedcompanies by determining their rules of business and requiring them to refer important items to the Company for
consultation or final determination. The Company monitors affiliates if necessary. If Directors of Group subsidiaries
discover any legal violations or serious compliance breaches, they should report them to the Statutory Auditors, thePresident, and compliance officer.
2. If Directors of Group subsidiaries consider the Company’s management principles or guidelines violate the law, undermine
corporate ethics in a specific country, or create a compliance problem, they shall report to the Internal Audit Department or
the Legal Department. Those departments shall report swiftly to the Board of Statutory Auditors, the President, and thecompliance officer, and request appropriate improvements.
(h) Employee Assistants Requested by Statutory Auditors and Ensuring the Independence and Effectiveness of Statutory Auditors’
Instructions to Employee Assistants
1. Upon receiving a request from the Board of Statutory Auditors, the Company shall establish rules to determine which
employees assist the Statutory Auditors with their duties, and assign appropriate internal personnel to the Statutory Auditors
or employ external lawyers or certified public accountants. To ensure assistants are independent of the Directors, theirperformance will be evaluated by Statutory Auditors, and the Board of Statutory Auditors will approve decisions made by
the Board of Directors on their assignment, dismissal, transfer, and wages, etc.
2. Assistants shall report directly to the Statutory Auditors and may not hold concurrent positions that involve the execution ofCompany business.
(i) Director and Employee Reporting to Statutory Auditors and Other Reports
1. Directors and employees of the Company and Group subsidiaries shall report any important matters that might impact theCompany’s operations or corporate performance to the Statutory Auditors. Irrespective of these rules, the Statutory Auditors
may request reports from Directors or employees of the Company, or Directors, employees, and Statutory Auditors ofGroup subsidiaries if necessary.
2. The Company and Group subsidiaries shall uphold the Group’s management principles, the FR Way, and the FR Code of
Conduct, and maintain frameworks for reporting legal violations or breaches of compliance rules to the Statutory Auditors.
If the Statutory Auditors judge there is a problem with this framework, they can inform the Directors and the Board of
Directors and request improvements.
3. The Company has made it widely known to Directors and employees across the entire FR Group that using reports
submitted to Statutory Auditors to penalize the submitter is forbidden. Submitted reports are protected by strict information
management systems.
4. Statutory Auditors communicate closely with the Independent Auditor, the Internal Audit Department, and Statutory
Auditors at Group companies through regular meetings and information exchange.
(j) Policy on Prepayment or Reimbursement of Expenses for Statutory Auditors
If Statutory Auditors submit requests for prepayment or reimbursement of expenses incurred during the course of their duties,
the Company shall pay invoices or settle debts swiftly, unless it proves the requested expenses or debt were not necessary to
the performance of the Statutory Auditor’s duties.

－

59 －

(k) Other Matters Ensuring Efficient Audits by Statutory Auditors
1. Statutory Auditors attend Board of Directors meetings and other important meetings to observe the reporting and discussionof significant issues. They may voice opinions if necessary.
2. The President meets regularly with Statutory Auditors to consult on pressing issues, ensure appropriate auditing
environments, and exchange views on significant issues highlighted in the auditing process.
(l) Eliminating Anti-social Forces
The Company works to extinguish anti-social forces by incorporating the following content in the FR Code of Conduct, andinforming all executives and employees of its uncompromising stance:
1. The Company adopts a firm stance against and refuses to engage with anti-social forces. The Company forbids the use offinancial payments to resolve unreasonable claims from anti-social forces.
2. The Company forbids the use of anti-social forces for Company or individual gain.
(5) Other stipulations in the Company’s articles of incorporation(a) Number of directors
The Company’s articles of incorporation stipulate that the number of directors shall be at least three but not more than ten.
(b) Election criteria for directors
The Company’s articles of incorporation stipulate that the election of directors shall not be based on cumulative voting. Also,
the articles of incorporation stipulate that elections shall be based on a majority vote by shareholders, with at least one-third ofeligible shareholders participating.
(c) Procedure for deciding dividends from surplus
Regarding the payment of dividends from surplus pursuant to the Companies Act, Article 459-1, the Company’s articles ofincorporation stipulate that dividends are decided by a resolution of the Board of Directors, and not by a resolution of theGeneral Meeting of Shareholders, unless otherwise stipulated by law. The authority to decide payments of dividends fromsurplus is granted to the Board of Directors to give flexibility in the return of cash to shareholders.
(d) Interim dividend
As part of the Company’s efforts to be flexible in the return of cash to shareholders, and pursuant to the stipulations ofCompanies Act Article 454-5, and under the Company’s articles of incorporation, an interim dividend may be paid at the endof February every year by a resolution of the Board of Directors.
(e) Limitation of liabilities for Directors and Statutory Auditors
Under the stipulations of the Company’s articles of incorporation (Article 426-1 of the Companies Act), the Company may
exempt, by decision of the Board of Directors, Directors (including former Directors) and Statutory Auditors (including
former Statutory Auditors) from liabilities for actions described in Article 423-1 of the Companies Act, to the extent allowed
by law. The purpose of this is to create an environment where Directors and Statutory Auditors can perform their duties andpursue their expected roles to the full extent of their abilities.
(f) Special resolutions of the General Meeting of Shareholders
Regarding extraordinary resolutions of the General Meeting of Shareholders based on the Companies Act, Article 309-2, theCompany’s articles of incorporation stipulate that these resolutions shall be passed by two-thirds vote of the shareholders, inwhich at least one-third of the eligible shareholders participate. This easing of the quorum rules for extraordinary resolutions
by the General Meeting of Shareholders is meant to ensure the smooth functioning of the General Meeting of Shareholders.

－

60 －

8. Board of Directors
A. Board of Directors
Male: 11 persons Female: 3 persons (21.4% of officers are female)
Position

Responsibilities

Name

Date of birth

Brief biography
August 1972
September 1972
August 1973

September 1984
June 2001

November 2002
Representative
director,
chairman,and president

September 2005
CEO

Tadashi Yanai

7 February 1949
November 2005

September 2008

June 2009

November 2011
November 2018

－

61 －

Joined FAST RETAILING
CO., LTD.
Director, FAST RETAILING
CO., LTD.
Senior Managing Director,
FAST RETAILING CO.,LTD.
President & CEO, FASTRETAILING CO., LTD.
External Director, Softbank
Corp. (currently SOFTBANKGROUP CORP.)
Chairman and CEO, FASTRETAILING CO., LTD.
Chairman, President, andCEO, FAST RETAILING
CO., LTD. (current)
Chairman, President, andCEO, UNIQLO CO., LTD.
(current)
Director and Chairman, GOVRETAILING CO., LTD.
(currently G.U. CO., LTD.)(current)
External Director, Nippon
Venture Capital Co., Ltd.
(current)
Director, LINK THEORYJAPAN CO., LTD. (current)
Representative Director, theFast Retailing Foundation(current)

Term ofofficeNumber ofshares held(Thousand shares)

Note 422,037

Position

Responsibilities

Name

Date of birth

Brief biography
April 1981
June 1989

November 1998

October 2003

June 2005
Director

Nobumichi Hattori

25 December 1957
November 2005

October 2006

April 2009

March 2015
June 2015
July 2016－

62 －Joined NISSAN MOTOR
CO.,LTD.
Joined Goldman Sachs andCompany, Headquarters (NewYork)
Managing Director ofGoldman Sachs andCompany, Headquarters (New
York), and M&A Advisory ofGoldman Sachs Japan Co.,
Ltd.
Visiting Associate Professor,
Graduate School ofInternational Corporate
Strategy, Hitotsubashi
University
External Director, Miraca
Holdings Inc. (currently H.U.
Group Holdings, Inc.)
External Director, FASTRETAILING CO., LTD.
(current)
Visiting Professor, Graduate
School of International
Corporate Strategy,
Hitotsubashi University
Visiting Professor, Waseda
Graduate School of Finance,
Accounting and Law (current)
External Auditor, FrontierManagement Inc. (current)
External Director, Hakuhodo
DY Holdings Inc. (current)
Visiting Professor, Graduate
School of Business
Administration, Keio
University (current)

Term ofofficeNumber ofshares held(Thousand shares)

Note 4-

Position

Responsibilities

Name

Date of birth
April 1978
December 1991
August 2000
January 2001
April 2008

Director

Masaaki Shintaku

10 September 1954

June 2008
November 2009

March 2019
June 2020
June 2021

April 1980
April 1991
June 2010

June 2010
June 2011
November 2012
Director

Takashi Nawa

8 June 1957
June 2014
June 2015
April 2019

June 2020
April 2021－

Term ofofficeNumber ofshares held(Thousand shares)

Joined IBM Japan, Ltd.
Joined Oracle Corporation
Japan
President & CEO, Oracle
Corporation Japan
Executive Vice President,
Oracle Corporation
Vice Chairman, Special
Olympics Nippon (currently
Special Olympics Nippon
Foundation)
Chairman, Oracle Corporation
Japan
External Director, FASTRETAILING CO., LTD.
(current)Counselor, Special Olympics
Nippon Foundation (current)
External Director, NTT
DOCOMO, INC. (current)
External Director, NTT
Communications Corporation(current)

Note 4-

Joined Mitsubishi
Corporation
Joined McKinsey &Company
Professor, The Graduate
School of International
Corporate Strategy,
Hitotsubashi University
President, Genesys Partners(current)
External Director, NEC
Capital Solutions (current)
External Director, FASTRETAILING CO., LTD.
(current)
External Director, DENSOCORPORATION
External Director, AjinomotoCo., Inc. (current)
Visiting Professor, The
Graduate School ofInternational Corporate
Strategy, Hitotsubashi
University (current)
External Director, Sompo
Holdings, Inc. (current)
Visiting Professor, Kyoto
University of Advanced
Science (current)

Note 4-

Brief biography

63 －Position

Responsibilities

Name

Date of birth
April 1971
June 2000
April 2004

April 2007
Director

Naotake Ono

28 October 1948
April 2011

November 2017

November 2018

January 1990

March 1994
January 1998
January 2000
April 2015
Director

Kathy Matsui

2 February 1965
November 2018
May 2021
July 2021
November 2021

November 2021－

Term ofofficeNumber ofshares held(Thousand shares)

Joined Daiwa House Industry
Co., Ltd.
Director, Daiwa House
Industry Co., Ltd .
Senior Managing Director,
Deputy Director, Sales
Division, Daiwa House
Industry Co., Ltd.
Representative Director andVice President, Director,
Sales Division, Daiwa House
Industry Co., Ltd.
Representative Director andPresident, Daiwa House
Industry Co., Ltd.
Special Consultant, Daiwa
House Industry Co., Ltd.
(retired as of March 2021)
External Director, FASTRETAILING CO., LTD.
(current)

Note 4-

Joined Barclays de Zoete
Wedd, Limited (current
Barclays Capital)
Joined Goldman Sachs Japan
Co., Ltd.
Managing Director, Goldman
Sachs Japan Co., Ltd.
Partner, Goldman Sachs Japan
Co., Ltd.
Vice Chairman, Goldman
Sachs Japan Co., Ltd. (retired
as of December 2020)
Director, the Fast RetailingFoundation
General Partner, MPowerPartners Fund L.P. (current)
External Director, Paidy Inc.
Council member, the Fast
Retailing Foundation(current)
External Director, FASTRETAILING CO., LTD.
(current)

Note 4

Brief biography

64 －

-

Position

Responsibilities

Name

Date of birth
April 1988
July 1998
January 2005
August 2011

Director

CFO

Takeshi Okazaki

9 July 1965

August 2011
September 2012

November 2018

November 2018
September 1997
July 2004

September 2009
January 2012
November 2012
Director

Kazumi Yanai

23 April 1974
November 2013
November 2015
July 2017

November 2018
June 2020

April 2001
April 2009

September 2012

Director

Koji Yanai

19 May 1977

May 2013
September 2013
November 2018
June 2020－

Term ofofficeNumber ofshares held(Thousand shares)

Joined Long Term Credit
Bank of Japan, Limited
Joined McKinsey &Company
Partner, McKinsey &Company
Joined FAST RETAILING
Co., Ltd.
Group Executive Officer &CFO, Group Senior
Executive Officer & CFO,
FAST RETAILING Co., Ltd.
(current)
Council member, the Fast
Retailing Foundation(current)
Director, FAST RETAILING
CO., LTD. (current)

Note 40

Joined Goldman Sachs andCompany
Joined Link Theory Holdings(US) Inc. (currently Theory
LLC), Headquarters (NewYork)
Joined FAST RETAILING
Co., Ltd.
Chairman, Theory LLC(current)
Group Executive Director,
FAST RETAILING Co., Ltd.
UNIQLO USA LLC COO
Chairman, UNIQLO USA
LLC (current)
CEO, Chairman andPresident, J BRAND
HOLDINGS, LLC
Director, FAST RETAILING
CO., LTD (current)
Executive Officer, FASTRETAILING CO., LTD(current)

Note 4

4,781

Joined Mitsubishi
Corporation
Seconded to Princes Limited(food business subsidiary inGreat Britain)
Joined FAST RETAILING
Co., Ltd., responsible for
UNIQLO Sports Marketing
Director, UNIQLO Global
MarketingGroup Executive Officer,
FAST RETAILING Co., Ltd.
Director, FAST RETAILING
CO., LTD (current)
Executive Officer, FASTRETAILING CO., LTD(current)

Note 4

4,781

Brief biography

65 －Position

Responsibilities

Name

Date of birth
April 1983
February 1994
September 1998

September 2005

January 2008

Standing
Statutory
AuditorMarch 2009
Masaaki Shinjo

28 January 1956
September 2009

January 2010

March 2011

November 2012

November 1981

March 1988

October 2001
Standing
Statutory
Auditor

Masumi Mizusawa

22 July 1959

February 2004

November 2019

November 2020－

Term ofofficeNumber ofshares held(Thousand shares)

Joined ASAHIPENCORPORATION
Joined FAST RETAILING
CO., LTD.
Entrusted operating officer,
manager of administration,
FAST RETAILING CO.,LTD.
General Manager, Group
Auditing, FAST RETAILING
CO., LTD.
Director, Onezone Corp
(currently G.U. CO., LTD.)
General Manager, Corporate
Administration, FASTRETAILING CO., LTD.
Statutory Auditor, GOV
Retailing Co., Ltd. (currently
G.U. CO., LTD.)
General Manager, Sales
Support Management
Division, UNIQLO CO.,LTD.
General Manager, Corporate
Planning & Management,
FAST RETAILING CO.,LTD.
Statutory Auditor, FASTRETAILING CO., LTD.
(current)

Note 6-

Joined the International
Department of Yamaichi
Securities Co., Ltd.
Joined the Research
Department of Kleinwort
Benson Securities (the Tokyo
branch of Dresdner Kleinwort
Wasserstein (Japan) Ltd.)
Joined the Investor Relations
Department of FASTRETAILING CO., LTD.
General Manager, Global
Corporate Management andControl Investor Relations
Division, FAST RETAILING
CO., LTD.
Statutory Auditor, FASTRETAILING CO., LTD.
(current)
Statutory Auditor, LINKTHEORY JAPAN CO., LTD.
(current)

Note 70

Brief biography

66 －Position

Responsibilities

Name

Date of birth
April 1991
April 1999

April 1999
January 2007
April 2007
Statutory
AuditorKeiko Kaneko

11 November 1967
November 2012

November 2012
June 2013

June 2019
February 1975
January 1986

April 1986

March 1989

April 2002
Statutory
AuditorTakao Kashitani

7 November 1948

June 2012

June 2012

November 2018－

Term ofofficeNumber ofshares held(Thousand shares)

Joined Mitsubishi
Corporation
Registered as a member ofJapan Federation of Bar
Associations
Joined Anderson, Mori &Tomotsune (AM&T) law firmPartner, AM&T (current)
Guest associate professor,
Tokyo University Graduate
School of Law
External Statutory Auditor,
FAST RETAILING CO.,LTD. (current)
External Statutory Auditor,
UNIQLO CO., LTD. (current)
External Statutory Auditor,
The Asahi Shimbun
Company (current)
External Director, Daifuku
Co., Ltd. (current)

Note 6-

Kashitani Public Accountant
Office (current)
Representative, CENTURY
Audit Corporation (currently
Ernst & Young ShinNihon
LLC)
Representative Director &CEO, Brain Core Co., Ltd.
(current)
Representative Director &CEO, F P Brain Co., Ltd.
(current)
Specially appointed
professor, Chuo University
Graduate School ofInternational Accounting
Department of Research(professional graduate
school)External Director, Tokyo
Electric Power Company(currently Tokyo ElectricPower Company Holdings)
External Director, Japan
Freight Railway Company(current)
External Statutory Auditor,
FAST RETAILING CO.,LTD. (current)

Note 5

Brief biography

67 －

-

Position

Responsibilities

Name

Date of birth

Brief biography
May 1972

Acquired qualification as acertified public accountant

February 1989

Japan Country Manager,
Anderson Consulting(currently Accenture)
President, Anderson
Consulting (currently
Accenture)
Chairman, Accenture
Senior Advisor, Accenture
President, International
University of Japan (IUJ)
External Director, Stanley
Electric Co., Ltd. (current)
External Director, YAMATOHOLDINGS CO., LTD.
(current)
Deputy Vice President, IUJSpecial Advisor, IUJ (current)
External Director, Kirin
Holdings Company, Limited(current)
External Statutory Auditor,
FAST RETAILING CO.,LTD. (current)

December 1995

April 2003
September 2007
October 2009
Statutory
Auditor

Masakatsu Mori

22 January 1947

June 2010
June 2013

November 2013
April 2018
March 2019

November 2020

Term ofofficeNumber ofshares held(Thousand shares)

Note 6-

Total

31,599(Notes) 1. Directors Nobumichi Hattori, Masaaki Shintaku, Takashi Nawa, Naotake Ono and Kathy Matsui are External Directors asprovided for in Article 2, Paragraph 15 of the Companies Act.
2. Directors Kazumi Yanai and Koji Yanai are relatives in the second degree of Tadashi Yanai, Representative Director,
Chairman and President.
3. Auditors Keiko Kaneko, Takao Kashitani and Masakatsu Mori are External Statutory Auditors as provided for in Article 2,
Paragraph 16 of the Companies Act.
4. For a one-year term beginning at the conclusion of the Ordinary General Meeting of Shareholders on 25 November 2021.
5. For a four-year term beginning at the conclusion of the Ordinary General Meeting of Shareholders on 29 November 2018.
6. For a four-year term beginning at the conclusion of the Ordinary General Meeting of Shareholders on 26 November 2020.
7. For a four-year term beginning at the conclusion of the Ordinary General Meeting of Shareholders on 28 November 2019.

－

68 －

B. External Directors and External Statutory Auditors(1) Functions, roles and selection of External Directors and External Statutory Auditors
The Company has five External Directors and three External Statutory Auditors.
It is the Company’s expectation that the External Directors will keep an eye on the management monitoring function. From abusiness perspective, the advice of these individuals, with their abundance of experience and expertise, makes a major
contribution to enhance the value of our enterprise.
It is also expected that External Statutory Auditors will monitor the performance of the Board of Directors. The Company
receives valuable advice based on their rich experience in a wide variety of fields.
Director Kathy Matsui serves as a council member on the Fast Retailing Foundation. Fast Retailing has concluded a contract with
the Foundation pertaining to the lease of office space, etc.
Statutory Auditor Keiko Kaneko serves as an external director of Daifuku Co., Ltd., a company with which Fast Retailing and its
group subsidiaries engage in business in regard to warehouse automation equipment.
Statutory Auditor Masakatsu Mori also serves as an outside director for YAMATO HOLDINGS CO., LTD., a company withwhich Fast Retailing Co., Ltd. and Group subsidiaries conduct business relating to the delivery of e-commerce products.
Shares of the Company held by External Statutory Auditors are stated in the “Number of shares held” column under the section“Board of Directors.”
Aside from the above, there are no distinctive interests between the Company and other External Directors or External Statutory
Auditors.
The External Directors and External Statutory Auditors receive reports at the Board of Directors meeting regarding internal
audits, the operation of internal controls, audits by Statutory Auditors, and the results of accounting audits.
With regard to the selection of External Directors and External Statutory Auditors, the Company has no specific standards on
independence from the Company, but it is the Company’s responsibility to reflect their advice and counsel in its decision-making
processes in an objective and independent fashion. For many years now, the Company has chosen many External Directors withrich experience as corporate managers in industry, with broad-ranging expertise and discerning views. In addition, to incorporate
wide range of stakeholders’ views in the audits of our business activities, we value both the independence and the diversity of ourExternal Statutory Auditors in various fields.

－

69 －

(2) Independent Directors
Five of the nine members of the Fast Retailing Board are external directors, and all of those five are recognized as Independent
Directors in accordance with the rules of the Tokyo Stock Exchange. The majority of the directors on the Board are external inorder to heighten the Board’s independence and strengthen its supervisory function.
In addition to the independence criteria set by the Tokyo Stock Exchange, Fast Retailing has set the following independence
standards and qualifications for external officers, including External Directors: A person shall not qualify as an Independent
Director of Fast Retailing, if:(a) he/she is, or has been within the past three years, a Business Partner*1 or an Executive Officer*2 of a Business Partner*2 of
the Fast Retailing Group, whose annual business dealings with Fast Retailing Group during the most recent business year
constituted 2% or more of the Fast Retailing Group’s consolidated revenue;(b) he/she is, or has been within the past three years, a Business Partner*1 of the Fast Retailing Group or an Executive Officer ofa Business Partner*2 of Fast Retailing, whose annual business dealings with the Fast Retailing Group during the most recent
business year constituted 2% or more of the Business Partner’s consolidated revenue;(c) he/she is a consultant, an accountant, or an attorney who receives, or has received over the past three years, any monies orproperty equivalent to 10 million yen or more from the Fast Retailing Group, except for remuneration for a director or an
auditor; or(d) he/she is, or has been over the past three years, a partner, an associate, or an employee of an accounting auditor of Fast
Retailing or its subsidiaries.
*1 “Business Partner” includes law firms, auditing firms, tax accounting firms, consultants, and any other organizations.
*2 “Executive Officer” means (i) for corporations, Executive Directors (as defined in the Companies Act of Japan), Executive
Officers (shikko-yaku, as defined in the Companies Act of Japan), corporate officers, and employees, and (ii) for noncorporate entities (including general incorporated associations (shadan-hojin), general incorporated foundations (zaidanhojin), and partnerships), directors with executive functions, officers, partners, associates, staff, and other employees.
(3) Supervision or auditing by External Directors or External Statutory Auditors; mutual cooperation between internal auditing,Statutory Auditor auditing, and accounting audits; and relationship with the Internal Control Department
At meetings of the Board of Directors, the Board of Statutory Auditors, and various committees, etc., external directors andExternal Statutory Auditor receive reports about the operating status of internal auditing and internal control systems, the resultsof Statutory Auditors audit and accounting audits, and other important matters, and they offer remarks and suggestions based on
their respective areas of expertise, experience, and knowledge.
At meetings of the Board of Directors, the Board of Statutory Auditors, various committees, etc., Statutory Auditors cooperatewith external directors and External Statutory Auditors in a timely manner and exchange opinions as well as share informationnecessary for the supervision and auditing of management.
For details regarding mutual cooperation between the External Statutory Auditors, the Internal Audit Department, and theaccounting auditor and the relationship with the Internal Control Department, please refer to (1) Status of Auditor’s Audit under
C. Status of Auditing.

－

70 －

C. Status of Auditing(1) Status of Statutory Auditor’s Audit
Statutory Auditors always attend Board of Directors meetings and audit the status of the execution of management. The Board of
Statutory Auditors consists of two internal full-time Statutory Auditors and three external Statutory Auditors, and after receiving
reports about important matters related to auditing on a regular and on-demand basis from the Internal Audit Department andaccounting auditors, the Board of Statutory Auditors discusses those important matters and always maintains a state ofcooperation. Both Statutory Auditor Takao Kashitani and Statutory Auditor Masakatsu Mori hold the qualification of certified
public accountant and have substantial knowledge related to finance and accounting.
During the fiscal year ended August 2021, we held 12 meetings of the Board of Auditors. The attendance record for each Auditor
is as follows.
Name

Number of meetings held

Attendance

Akira Tanaka

1212Masaaki Shinjo

1212Masumi Mizusawa

12

12

Keiko Kaneko

12

12

Takao Kashitani

12

11

Masakatsu Mori

10

10

Key matters discussed by the Board of Statutory auditors include the current situation and issues facing the Frontend Division,HR, and GU respectively.
In addition, the role of full-time Auditors includes the timely on-site auditing of key companies' new and existing stores, attending
domestic and international store audit briefing sessions, and attending regular and extraordinary Board of Directors meetings andother employee meetings.
(2) Status of internal auditing
The Company has an Internal Audit Department that is independent from the executive departments, and, as at 31 August 2021,
seven dedicated staff members regularly verify the appropriateness and effectiveness of internal control systems and audit thestatus of the execution of business.
(3) Accounting audits(a) Name of audit firm
Deloitte Touche Tohmatsu LLC(b) Continuous auditing period
4 years(c) Name of Certified Public Accountants
Koichi Okubo, Hirofumi Otani(d) Group of assistants to the independent auditor
Based on the audit plan formulated by Deloitte Touche Tohmatsu LLC, the group of assistants to the independent auditor
consists of 12 CPAs, 4 successful Certified Public Accountant applicants and 29 others.

－

71 －

(e) Policy and reasons for selecting audit corporation
Based on the “Practical Guidelines for Auditors, etc. Concerning the Formulation of Evaluation and Selection Standards for
Accounting Auditors” (Japan Audit & Supervisory Board Members Association; 13 October, 2017), the Board of Statutory
Auditors selected Deloitte Touche Tohmatsu LLC to be the accounting auditor after comprehensively examining their quality
control systems, audit team independence, communication systems, group audit systems, handling of fraud risks, and the like inaccordance with the prescribed selection standards and evaluation standards for accounting auditors. Regarding the policy for
determining the dismissal or non-reappointment of an accounting auditor, in the event that it is acknowledged that an itemprescribed in an item under Article 340-1 of the Companies Act is applicable, the Board of Statutory Auditors will pass a
resolution to the effect that the Board of Statutory Auditors will dismiss the accounting auditor based on the consent of all
Statutory Auditors, and in the event that it is acknowledged that it is difficult for the accounting auditor to perform anappropriate audit due to an event arising that otherwise impairs the accounting auditor’s competence or independence, the Boardof Statutory Auditors will pass a resolution to the effect that the Board of Statutory Auditors will make a proposal to the General
Meeting of Shareholders to dismiss or not reappoint the accounting auditor.
(f) Evaluation of the accounting auditor by Statutory Auditors and the Board of Statutory Auditors
In addition to auditing and examining the independence, quality-control status, suitability of the system for performing duties,
and status of implementing accounting audits in the current fiscal year of the accounting auditor, the Board of Statutory Auditors
conducts evaluations by receiving reports from the accounting auditor on the status of performing its duties and requesting
explanations when necessary.

－

72 －

D. Details of Independent Auditor’s remuneration(1) Details of remuneration for Independent Auditor
Year ended 31
August 2020

Year ended 31
August 2021

Remuneration
for audit andcertification duties(Millions of yen)

Remuneration
for audit andcertification duties(Millions of yen)

Reporting Entity

239

209

Consolidated subsidiaries

40

40

Total

279

249

Class

(2) Details of remuneration for member firms of the Deloitte global network (except (1))
Year ended 31 August 2020

Year ended 31 August 2021

Remuneration
for audit andcertification duties(Millions of yen)

Remuneration
for duties otherthan audit(Millions of yen)

Remuneration
for audit andcertification duties(Millions of yen)

Remuneration
for duties otherthan audit(Millions of yen)

-

463

-

475

Consolidated subsidiaries

266

100

292

95

Total

266

563

292

570

Class

Reporting Entity

Year ended 31 August 2020 (1 September 2019 - 31 August 2020)
The non-audit services paid for by the Company and the Company's subsidiaries to organizations belonging to the same network
as audit-certified public accountants, etc., comprise advisory services related to the e-commerce platform.
Year ended 31 August 2021 (1 September 2020 - 31 August 2021)
The non-audit services paid for by The Company and The Company's subsidiaries to organizations belonging to the same
network as audit-certified public accountants, etc., comprise advisory services related to the e-commerce platform.
(3) Other important details regarding remuneration for audit and certification duties
Not applicable.
(4) Policies for determination of accounting audit remuneration
The Company’s articles of incorporation stipulate that remuneration to independent auditor for audit services is determined by
the representative director, with the consent of the Board of Statutory Auditors.
(5) Reasons for agreement of the Board of Statutory Auditors to the remuneration of the Independent Auditor
The Board of Statutory Auditors agreed to the remuneration of the independent auditor as stipulated in Article 399, Item 1 of theCompanies Act, after checking auditing estimates versus actual performance in previous business years, including itemized
auditing hours and remuneration, and investigating whether the estimates for the year ended 31 August 2021 were reasonable,
based on the practical guidelines relating to independent auditor published by the Japan Audit & Supervisory Board Members
Association.

－

73 －

E. Directors’ Remuneration(1) Policies and process for determination of directors’ remuneration
The maximum annual remuneration for directors has been capped at the 2,000 million yen figure (including an annual figure of
200 million yen for external directors) determined by shareholder resolution at the 60th annual general meeting of shareholders
held on November 25, 2021 (the resolution covers nine directors of which five are external directors). Meanwhile, the maximum
annual remuneration for statutory auditors is capped at 100 million yen as determined by shareholder resolution at the 42nd
annual general meeting of shareholders held on November 26, 2003 (the resolution covers five statutory auditors).
The Company, with reference to the appropriate shareholder resolutions, determines the composition of individual directors’compensation at Board of Directors’ meetings according to the policy detailed below.
Remuneration for internal directors (i.e. directors who are not external directors) is made up of a basic compensation component,
which is a fixed sum, and a performance-related compensation component, which takes into account the performance of thedirector in question as well as other factors. The basic remuneration component is calculated according to a predefinedcompensation table based on each individual’s grade within the company determined with reference to various factors including
the internal director’s job description, level of responsibility, performance, and contribution to the company. The individual gradefor each internal director is discussed in the Nomination and Remuneration Advisory Committee, which is made up primarily of
external directors and external statutory auditors, and then decided by the Board of Directors.
The performance-related remuneration component consists of short-term and long-term performance-related compensation
elements. Each element is calculated according to a predefined table based on an evaluation of each internal director’s
performance during a set period and is debated by the above-mentioned Nomination and Remuneration Advisory Committee. The
final decision on remuneration is then made by company president, CEO and chairman Tadashi Yanai, who has the confidence of
the Board of Directors, within the predetermined overall remuneration limits approved by the annual general meeting ofshareholders.
External director remuneration is fixed at an annual figure of 15 million yen. Based on debated by the above-mentioned
Nomination and Remuneration Advisory Committee, the fixed amount is decided by company president, CEO and chairman
Tadashi Yanai, who has the confidence of the Board of Directors regarding the determination of individual director remuneration
totals within the predetermined overall remuneration limits approved by the annual general meeting of shareholders.
As stated above, the Board of Directors delegates the determination of individual director remuneration, etc. to company
president, CEO and chairman Tadashi Yanai. We believe that authority is appropriately exercised when determining remuneration
etc. for individual directors given the fact that all decisions are made following discussions in the Nomination and Remuneration
Advisory Committee, which comprises mainly external directors and external statutory auditors.
Individual director remuneration for the fiscal year ended August 31, 2021 was determined in accordance with the abovementioned process. In addition, the Board of Directors judged the composition of director remuneration, etc. for the said fiscal
year to have been determined according to the above-mentioned policy.
The remuneration for Statutory Auditors is determined through discussions by the Board of Statutory Auditors.
The compensation of the Company's internal directors, who are mainly officers in the Company's consolidated subsidiaries, ispaid by the relevant consolidated subsidiaries.

－

74 －

(2) Total remuneration including compensation for each director classification at the Company, remuneration by type, and number ofrecipient directors

Executive category

Entity category

Totalamount of
remuneration(Millions ofyen)

Total amount of remuneration, by type(Millions of yen)
Basic
Compensation

Short-term
performancelinked
remuneration

Long-term
performancelinked
remuneration

Number of
executives(Persons)

Directors (excluding
external directors)

the Company

612

379

220

13

the subsidiaries

206

139

48

18

External directors

the Company

50

50

-

-

5

the Company

50

50

-

-

3

External Statutory

the Company

31

31

-

-

Auditors

the subsidiaries

4

4

-

-

4

Statutory Auditors(excluding External
Statutory Auditors)

4(a) The performance-related remuneration figures are provisional calculations made prior to the evaluation of results for the fiscal
year ended August 31, 2021 after accounting for costs. The actual amounts paid are calculated and decided based on
performance evaluations of individual directors.
(b) Total amount of consolidated remuneration, etc., for each officer: note that this is to be more than 100 million yen.

Name

Executive Director
Tadashi Yanai
DirectorTakeshi Okazaki
Director
Kazumi Yanai
Director
Koji Yanai

Total amountof
remuneration(Millions ofyen)

Total amount of remuneration, by type (Millions of yen)
Entity category
Basic Compensation

Short-term
performance-linked
remuneration

Long-term
performance-linked
remuneration

400

the Company

240

160

-

202

the Company

129

60

13

the Company

10

-

-

Theory LLC,
etc.

80

18

6

UNIQLO CO.,LTD., etc.

59

30

11

115

100

(Note) As stated below, short-term performance-linked compensation will be calculated based on performance evaluations from theprevious fiscal year.
(3) Salaries for key personnel serving concurrently as an employee and an officer
Not applicable.
(4) Details of methods for determining director remuneration amounts(a) Remuneration for statutory auditors is calculated within the total amount approved by the general meeting of shareholders as
explained above and then discussed and decided by statutory auditors.

－

75 －

(b) Based on debated by the above-mentioned Nomination and Remuneration Advisory Committee, the company president, CEOand chairman Tadashi Yanai decides a fixed annual remuneration for external directors within the above-mentioned total amountapproved by the general meeting of shareholders.
(c) Remuneration for internal directors consists of two elements: (1) basic remuneration and (2) performance-related remuneration(short-term and long-term performance-related remuneration) as detailed below. Individual remuneration amounts are based on
the totals calculated using the method detailed below and discussed in the Nomination and Remuneration Advisory Committee
before being finally decided by the company president, CEO and chairman Tadashi Yanai within the above-mentioned total
amount approved by the general meeting of shareholders.
<Basic remuneration>
Calculated using a predefined remuneration table based on the employment grade of each individual internal director and paid ineven monthly installments.
<Short-term performance-related remuneration>
The targeted short-term performance-related remuneration amount is determined according to a table of short-term performancerelated remuneration by employee grade. It is calculated according to the following payment standard table after selecting a ranking
from five available levels generated by our target management system to reflect the degree of target achievement during theprevious fiscal period. The target management system determines targets based on corporate performance, organizational, andindividual director targets.
Grade

Definition

Percentage of Target Achieved

A

Targets greatly surpassed and many superb courses of action are evident

200%

AB

Targets achieved and superb courses of action are evident

150%

B

Targets achieved, or superb courses of action adequate for achieving target areevident

100%

BC

Targets not achieved, but it is acknowledged that efforts have been made that may
lead to future developments

75%

C

Targets not achieved and the anticipated course of action was lacking

50%<Long-term performance-related remuneration>
The targeted long-term performance-related remuneration amount is determined according to a table of long-term performancerelated remuneration per employee grade.
A) A total equivalent to one third of the targeted long-term performance-related remuneration amount is considered to relate to Fast
Retailing’s corporate value and is therefore allocated in phantom stock which are tied to the company’s spot share price.
Phantom stocks are a cash-based remuneration related to the company share price, which are automatically executed three years
after they were granted as a cash payment based on the company’s share price on the day of execution. The company does not
pay dividends or dividend-equivalent amounts.
B) A total equivalent to two thirds of the targeted long-term performance-related remuneration amount is paid in cash as anincentive to improve strategy and performance at the particular operational unit for which an individual director is responsible.
The total is calculated based on a performance evaluation of the operational units directed by the individual over the three-year
period following the setting of the initial targets.
B-1) 50% of the cash-allowance portion is determined based on quantitative targets. The total is determined by multiplying thetargeted amount by an operational coefficient calculated based on a predefined table of standards that indicates the rate ofattainment of planned operating profit totals over the preceding three years at each operational unit, and the unit’s operating
profit margin.

－

76 －

B-2) The remaining 50% of the cash-allowance portion is determined based on qualitative targets. The total is calculated basedon the below table of payment standards after evaluating the degree of attainment of medium-term (three-year) targets set
out in the year that the remuneration was granted.
Grade

Definition

Percentage of Target Achieved

A

Targets greatly surpassed and many superb courses of action are evident

200%

AB

Targets achieved and superb courses of action are evident

150%

B

Targets achieved, or superb courses of action adequate for achieving target areevident

100%

BC
C

Targets not achieved, but it is acknowledged that efforts have been made that may
lead to future developments
Targets not achieved and the anticipated course of action was lacking

－

77 －

75%
50%

F. Status of share holdings(1) Criteria and approach to “investment share” categories
The Company categorizes share holdings that are deemed to contribute to improving medium-to-long-term corporate value as“investment shares with a purpose other than net investment” and other shares as “investment shares for the purpose of net
investment.”(2) Investment shares for which the investment purpose is a purpose other than net investment(a) In principle, the Group has a policy of not having any cross-holdings; however, on occasion these holdings may occur - but onlyin the minimum number of shares required. Each year, the Board of Directors verifies the economic rationality, etc., for any
cross-holdings; this is done for each individual stock and includes any medium-to-long term trading relationships. The Board
then makes a comprehensive judgment on the significance of the holdings. The specific contents of the verifications are notdisclosed due to the trading relationships with the corporation(s) in which shares are held.
(b) Number of stocks and amounts included in the balance sheet
Amounts included in
the balance sheet(Millions of yen)

Number of stocks
Unlisted shares

3

199

Shares other than unlisted shares

1808(Stock for which the number of shares increased in the current business year)
No applicable matters(Stocks for which the number of shares decreased in the current business year)
Amounts included in
the balance sheet(Millions of yen)

Number of stocks
Unlisted shares--

Shares other than unlisted shares

2

883

－

78 －

(c) Information on the number of shares and balance sheet difficulties for “specified investment shares” and “deemed shares” - byindividual stockSpecified Investment Shares:

Stock

Current
business year

Previousbusiness year

Number ofsharesNumber ofsharesBalance sheet
amount(Millions ofyen)

Balance sheet
amount(Millions ofyen)-

286,500

Holding purpose, quantitative holding
effect, and reason for increase in numberof shares

Holding theCompany’s
shares--Matsuoka Corporation-

566

18,136,500

20,815,000
These shares are held to try to strengthen

Crystal International
Group Ltd.

ties in the medium-term, as a strategic
partner.
808

No

591

(Notes) 1. We are unable to disclose the quantitative effects of our holdings, as they include information such as transaction volumes
with companies in which we have invested. See (a) for more information on how we tested the rationality behind ourholdings.
2. A "-" indicates that the Company does not hold that particular stock.
Deemed Shares: Not applicable.
(3) Investment shares held for the investment purpose
Not applicable.

－

79 －

9. Financial Information
A. Preparation of consolidated financial statements(1) Since the Company meets all criteria of a “specific company” defined in Articles 1-2 of the Rules Governing Term, Form andPreparation of Consolidated Financial Statements (Financial Ministerial Order 28, 1976) (hereinafter referred to as the “Rules on
Consolidated Financial Statements”), the consolidated financial statements of the Group were prepared in accordance with IFRS
pursuant to Article 93 of the Rules on Consolidated Financial Statements.
(2) The financial statements of the Company were prepared in accordance with the Rules Governing Term, Form and Presentation of
Non-consolidated Financial Statements (Financial Ministerial Order 59, 1963) (hereinafter referred to as the “Rules on Nonconsolidated Financial Statements”).
The non-consolidated financial statements are prepared in accordance with the provisions set out in Article 127 of the Rules on
Non-Consolidated Financial Statements, etc., as the Company is categorized as a company that may be allowed to prepare its
financial statements according to special provisions.
(3) In this report, amounts are rounded down to the nearest million yen.
B. Audit and certification
The Company’s consolidated and non-consolidated financial statements for the fiscal year from 1 September 2020 - 31 August2021 have been audited by Deloitte Touche Tohmatsu LLC in accordance with auditing standards generally accepted in Japanpursuant to Article 193-2-1 of the Financial Instruments and Exchange Act. Deloitte Touche Tohmatsu LLC also conducted theaudit of consolidated financial statements of the Company in accordance with International Standards on Auditing (ISA).
C. Special measures for ensuring the accuracy of our consolidated financial statements and a framework for ensuring consolidated
financial statements are appropriately prepared in accordance with IFRS.
The Company has taken special measures to ensure the appropriateness of our consolidated financial statements and has establisheda framework to ensure our consolidated financial statements are appropriately prepared in accordance with IFRS. Details of theseare given below.
(1) To establish a framework capable of adapting appropriately to changes in accounting standards, the Company has made efforts
to build specialist knowledge by appointing employees who are well versed in IFRS, joining the Accounting Standards Board ofJapan and similar organizations, and participating in training programs.
(2) To ensure that we appropriately prepared consolidated financial statements in accordance with IFRS, we drafted Group
guidelines for accounting practices based on IFRS, and have been conducting accounting procedures based on these guidelines.
We regularly obtain standards and press releases published by the International Accounting Standards Board (“IASB”), study
the latest standards and their potential impact on our Company, and update our Group guidelines for accounting practices
accordingly.

－

80 －

D. Consolidated Financial Statements(1) Consolidated statement of financial position(Millions of yen)

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
Right-of-use assets
Goodwill
Intangible assets
Financial assets
Investments in associates accounted
for using the equity method
Deferred tax assets
Derivative financial assets
Other assets
Total non-current assets
Total assets

Notes

As at 31 August 2020

As at 31 August 2021

8,30
9,30
11,30
10
30

1,093,531
67,06949,890417,529
14,413
2,126
10,6291,655,191

1,177,736
50,54656,157394,868
27,103
2,992
15,2701,724,674

13,15
15,17
14
14,15
11,30

136,123
399,944
8,092
66,83367,770168,177
390,537
8,092
66,93967,122

16

14,221

18,236

18
30
12,15

45,447
10,983
7,383
756,799
2,411,990

37,12522,552
6,520
785,3022,509,976

19,30
11,28,30
30
17,28,30

210,747
213,301
2,763
114,652
22,602752
82,636
647,455

220,057
104,969
2,493
117,083
38,606
2,149
95,652581,012370,780
351,526
32,658
7,760
3,205
2,524
768,455
1,415,910

370,799
343,574
39,046
9,860
1,042
2,342
766,665
1,347,678

12

Liabilities and equity
LIABILITIESCurrent 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

20
12

11,28,30
17,28,30
20
18
30
12

(continued)

－

81 －

(Millions of yen)

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

－

Notes

As at 31 August 2020

As at 31 August 2021

21
21
21
21
21

10,27323,365
933,303(15,129)
4,749
956,562
39,516
996,079
2,411,990

10,27325,3601,054,791(14,973)
41,031
1,116,484
45,813
1,162,298
2,509,976

82 －(2) Consolidated statement of profit or loss
(Millions of yen)
Notes
Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Other income
Other expenses
Share of profit and loss of associates
accounted for using the equity method
Operating profit
Finance income
Finance costs
Profit before income taxes
Income tax expense
Profit for the year

22

23
24
15,24

2,132,992(1,059,036)
1,073,955(818,427)
18,238(25,315)

16

321

561

149,347
11,228(7,707)
152,868(62,470)
90,398249,01123,859(6,998)265,872(90,188)
175,684

90,35740
90,398

169,847
5,836
175,684885.15883.62

1,663.12
1,660.44

18

Profit for the year attributable to:
Owners of the Parent
Non-controlling interests
Total

27
27

－

Year ended
31 August 2021

2,008,846(1,033,000)
975,845(805,821)
7,954(28,952)

25
25

Earnings per share
Basic (Yen)
Diluted (Yen)Year ended
31 August 202083 －(3) Consolidated statement of comprehensive income(Millions of yen)
Notes
Profit for the year
Other comprehensive income / (loss),
net of income taxes
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 year

Year ended
31 August 2021

90,398

175,684

(630)

541

(630)

541

26

5,227

20,26626

14,13026,333

26

(39)

65

19,31846,665

18,687

47,207

109,085

222,891

110,134(1,049)109,085

215,309
7,582
222,891

26

Attributable to:
Owners of the Parent
Non-controlling interests
Total comprehensive income for the year－

Year ended
31 August 202084 －(4) Consolidated statement of changes in equity
For the year ended 31 August 2020
(Millions of yen)
Other components of equity

Notes

As at 1 September 2019
Effect of change in accounting
policyBalance after adjustment

Equityattributable
Nonto owners controllingof theinterests
ParentCapitalstock

CapitalsurplusRetainedearnings

FinancialassetsForeign
Share of other
Treasurymeasured
Cash-flow
currency
comprehensive
stock,
at fair value
hedgetranslation
income ofat costthrough otherreserve
reserveassociatescomprehensive
income / (loss)

10,273

20,603928,748(15,271)(697)(13,929)

8,906

(11)

(5,732)

938,62144,913

983,534--(35,094)

-

-

-

-

-

-

(35,094)(1,331)(36,426)

10,273

20,603

893,653(15,271)(697)(13,929)

8,906

(11)

(5,732)

903,526

43,581

947,108--

90,357

-

-

-

-

-

-

90,35740

90,398

-

-

-

-

(630)

5,440

15,007(39)

19,776

19,776(1,089)18,687--90,357

-

(630)

5,440

15,007(39)

19,776110,134(1,049)109,085

Total

Total
equityNet changes during the year
Comprehensive income
Profit for the year
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
assetsTransfer to retained earnings
Total transactions with theowners of the Parent
Total net changes during the year
As at 31 August 2020

26

21

-

-

-

(5)

-

-

-

-

-

(5)

-

(5)

21
21
21

-

1,496
1,265

(48,994)
-

148
-

-

-

-

-

-

1,644
(48,994)
1,265(2,038)-1,644(51,032)
1,265

-

-

-

-

-

-

(11,008)-(11,008)(11,008)(976)(11,985)--(1,713)

-

1,713

-

-

-

1,713

-

-

-

-

2,761

(50,708)

142

1,713

-

(11,008)-(9,294)(57,098)(3,015)(60,113)-

2,761

39,649

142

1,082

5,440

3,998

(39)

10,48253,036(4,064)

48,971

10,27323,365

933,303(15,129)385(8,489)12,905

(51)

4,749

956,562

39,516

996,079－85 －For the year ended 31 August 2021
(Millions of yen)
Other components of equity

Capitalstock

CapitalsurplusRetainedearnings

FinancialassetsForeign
Share of other
Treasurymeasured
Cash-flow
currency
comprehensive
stock,
at fair value
hedgetranslation
income ofat costthrough otherreserve
reserveassociatescomprehensive
income / (loss)

10,27323,365

933,303(15,129)--

169,847

-

-

-

-

-

-

-

-

541

18,34526,509--169,847-541

18,34526,509

-

1,836
159

(49,015)
-

(12)
168
-

-

-

-

-

-

-

-

Transfer to retained earnings

-

-

655

-

Others----Total transactions with theowners of the Parent

-

1,995

(48,359)

155

Total net changes during the year

-

1,995

121,487

155

10,27325,3601,054,791(14,973)

Notes

As at 1 September 2020

385

(8,489)12,905(51)

Equityattributable
Nonto owners controllingof theinterests
Parent

Total

Total
equity4,749

956,562

39,516

996,079--

169,847

5,836

175,684

65

45,46145,461

1,745

47,20765

45,461

215,309

7,582

222,891

-

-

-

(12)
2,005
(49,015)159(1,867)
-

(12)
2,005
(50,882)
159-(8,523)-(8,523)(8,523)67(8,456)

(655)

-

-

-

(655)

-

-

-

-

-

-

-

-

-

514

514

(655)

-

(8,523)-(9,179)(55,387)(1,285)(56,673)(113)

18,345

17,98565

36,282

159,921

6,296

166,218

271

9,855

30,89013

41,031

1,116,484

45,813

1,162,298

Net changes during the year
Comprehensive income
Profit for the year
Other comprehensive
income / (loss)

26

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

As at 31 August 2021

21
21
21
21

－

86 －

(5) Consolidated statement of cash flows(Millions of yen)
Notes
Cash flows from operating activities
Profit before income taxes
Depreciation and amortization
Impairment losses
Interest and dividend income
Interest expenses
Foreign exchange losses / (gains)Share of profit and loss of associates accounted forusing 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 dividend income received
Interest paid
Income taxes paid
Income taxes refunded
Net cash generated by operating activities

15

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

Year ended
31 August 2020

Year ended
31 August 2021

152,868
177,848
23,074(9,724)
7,706(1,503)

265,872
177,910
16,908(4,628)
6,990(19,222)

(321)

(561)

1,125
(4,164)(2,665)
18,60010,686(44,567)
8,776
337,7388,546(6,783)(75,460)
827
264,868985
15,33436,749
384
3,494
9,300
153
509,672
4,134(6,101)(80,555)
1,818
428,968(88,714)(102,307)

83,502

99,943(46,500)(21,008)(1,808)(7,171)(56,500)(19,624)(846)(3,979)

6,394

4,542

(673)
(75,981)(4,232)407(82,597)(continued)

－

87 －

(Millions of yen)
Notes
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

28
28
28
28
21
28

Effect of exchange rate changes on the balance of cash
held in foreign currencies
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of year
Cash and cash equivalents at the end of year

8
8

－

88 －

Year ended
31 August 2020

Year ended
31 August 2021

35,019(21,546)(4,343)(48,995)(2,328)(141,216)
142(183,268)

64,247(67,804)(100,000)(48,993)(2,342)(148,248)155(302,985)

1,393

40,8187,011
1,086,519
1,093,531

84,204
1,093,531
1,177,736

(6) Notes to the consolidated financial statements
1. Reporting Entity
FAST RETAILING CO., LTD. is a company incorporated in Japan. The locations of the registered headquarters and principal
offices of the Company are disclosed at the Group’s website (http://www.fastretailing.com/eng/).
The principal activities of the Group are the UNIQLO business (casual wear retail business operating under the “UNIQLO” brandin Japan and overseas), GU business (casual wear retail business operating under the “GU” brand in Japan and overseas) andTheory business (apparel designing and retail business in Japan and overseas), etc.
2. Basis of Preparation
A. Compliance with IFRSThe consolidated financial statements of the Group have been prepared in compliance with IFRS issued by the IASB.
The Group meets all criteria of a “specified company” defined under Article 1-2 of the Rules Governing Term, Form, andPreparation of Consolidated Financial Statements accordingly, applies Article 93 of the Rules Governing Term, Form, andPreparation of Consolidated Financial Statements.
B. Approval of the Consolidated Financial Statements
The consolidated financial statements were approved on 26 November 2021 by Tadashi Yanai, Chairman, President, and CEO,and Takeshi Okazaki, Group Senior Vice President and CFO.
C. Basis of Measurement
The consolidated financial statements have been prepared on a historical cost basis, except for certain assets, liabilities, andfinancial instruments which are measured at fair value as indicated in “3. Significant Accounting Policies.”
D. Functional Currency and Presentation Currency
The presentation currency for the Group’s consolidated financial statements is yen (in units of millions of yen), which is also
the Company’s functional currency. All values are rounded down to the nearest million yen, except when otherwise indicated.
E. Use of Estimates and Judgments
The preparation of the consolidated financial statements in accordance with IFRS requires management to make judgments,
estimates, and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities,
income and expenses. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. The effects of the review of accounting estimates
are recognized in the accounting period in which the estimates were reviewed and in future accounting periods.
Information about important estimates and judgments that have significant effects on the amounts recognized in the
consolidated financial statements is as follows:• Valuation of inventories (3. Significant Accounting Policies F. and Note 10)• Valuation of property, plant and equipment, and right-of-use assets (3. Significant Accounting Policies J. and Note 15)• Recoverability of deferred tax assets (3. Significant Accounting Policies N. and Note 18)• Accounting treatment and valuation of provisions (3. Significant Accounting Policies K. and Note 20)• Fair value measurement of financial instruments (3. Significant Accounting Policies D. and Note 30)
With the global spread of COVID-19, the Group's performance has been adversely affected due to temporarily closing stores,
etc. Regarding impairment to our non-financial assets, in the previous consolidated fiscal year, we had assumed that the impactof the COVID-19 pandemic would continue to be felt through to the end of August 2021, on the basis of the assumption thatbusiness activities would gradually return to normal. However, in the current consolidated fiscal year, there continues to be
uncertainty around the future economic outlook owing to concerns such as the spread of the virus, and the timing for thesituation subsiding differs from region to region and on a case-by-case basis. As such, we made accounting estimates involving
the assumption that the impact will last until the end of August 2022 for most countries and regions including Japan, with thesituation taking longer to get under control for stores in certain other countries and regions.
－89 －3. Significant Accounting Policies
A. Basis of Consolidation(1) Subsidiaries
A subsidiary is an entity (including a structured entity), directly or indirectly, controlled by the Company. The Group controls
enterprises when it is exposed, or has rights, to variable returns arising from its involvement in those enterprises or when theGroup has rights to variable returns in those enterprises and is able to have an impact on said variable returns through its
power over those enterprises. A subsidiary’s financial statements are incorporated into the Group’s consolidated financial
statements from the date on which the Group, obtains control until the date that control ceases.
The subsidiaries adopted the consistent accounting policies as the Company in the preparation of their financial statements.
All intra-group balances, transactions within the Group as well as unrealized profit and loss resulting from transactions within
the Group are eliminated at the time of preparation of the consolidated financial statements.
The statutory fiscal year end dates for FAST RETAILING (CHINA) TRADING CO., LTD., UNIQLO TRADING CO., LTD.,
FAST RETAILING (SHANGHAI) TRADING CO., LTD., GU (Shanghai) Co., Ltd. and 11 other companies vary between 31
December, 31 March and 30 June.
Management prepares the financial statements of these subsidiaries as at the Group’s year-end solely for the Group’s
consolidation purpose.
The financial statements of other subsidiaries are prepared using the same reporting period as the Parent company.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.
Any difference between the adjustment to the non-controlling interest and the fair value of the consideration received isrecognized directly in equity as interests attributable to owners of the Parent.
Profit or loss and each component of other comprehensive income are attributed to the owners of the Parent and to the noncontrolling interests, even if this results in the non-controlling interests having a deficit balance.
The number of consolidated subsidiaries as at 31 August 2021 is 130.
(2) Investments in associates
An associate is an entity in which the Group has significant influence over the financial and operating policies.
If the Group holds 20% or more of the voting rights of another enterprise, it is presumed that the Group has a significant
influence over the other enterprise. Investments in associates are accounted for applying the equity method, and measured athistorical cost at the time of acquisition.
Thereafter the carrying amount of the investment is adjusted to recognize changes in the Group’s share of net assets of theassociate since acquisition date. The consolidated statement of profit or loss reflects the Group’s share of the results ofoperations of the associate. Any change in other comprehensive income of those investees is presented as part of the Group’s
other comprehensive income.
Unrealized gains and losses resulting from transactions between the Group and the associate are eliminated to the extent of theinterest in the associate.
The number of associates as at 31 August 2021 is three.

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B. Business combinations
Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured at theaggregation of the acquisition date fair values of assets transferred, liabilities assumed, and equity interests issued by theCompany in exchange for control of the acquired company.
If the cost of an acquisition exceeds the fair value of the identifiable assets and liabilities, the excess is recorded as goodwill on
the consolidated statement of financial position. If it is below the fair value, the difference is immediately recorded as gains on
the consolidated statement of profit or loss.
Acquisition-related costs are expensed as incurred. Additional acquisitions of non-controlling interests are accounted for as
equity transactions, and no goodwill is recognized.
Contingent liabilities of acquired companies are recognized in a business combination only if they are present obligations, wereincurred as a result of a past event, and their fair value can be reliably measured.
For each business combination, the Group elects whether to measure the non-controlling interests in the acquiree at fair value orat the proportionate share of the acquiree’s identifiable net assets.
If the initial accounting for a business combination is incomplete by the reporting date of the fiscal year in which the businesscombination occurs, the items for which the acquisition accounting is incomplete are reported using provisional amounts. Thoseamounts provisionally recognized on the acquisition date are retrospectively adjusted to reflect new information as if theacquisitions took place during the measurement period, had facts and circumstances that existed at the acquisition date been
known at that time, they would have affected the amounts recognized on that date. Additional assets and liabilities arerecognized if new information results in the recognition of additional assets or liabilities. The measurement period should bewithin one year.
C. Foreign Currencies(1) Transactions and balances
Transactions in foreign currencies are initially recorded by the Group’s entities at their respective functional currency spot
rates at the date the transaction first qualifies for recognition.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of
exchange at the reporting date. Differences arising from settlement or translation of monetary items are recognized in profit orloss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates
at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using theexchange rates at the date when the fair value is determined. The gain or loss arising on translation of non-monetary items
measured at fair value is treated in line with the recognition of gain or loss on change in fair value of the item (i.e., translationdifferences on items whose fair value gain or loss is recognized in other comprehensive income or profit or loss are also
recognized in other comprehensive income or profit or loss, respectively).
(2) Foreign Operations
Upon consolidation, the assets and liabilities of foreign operations are translated into yen at the rate of exchange prevailing at
each reporting date and their statements of profit or loss are translated at average exchange rates during the period. The
exchange differences arising on translation for consolidation are recognized in other comprehensive income. On disposal of aforeign operation, the component of other comprehensive income relating to that particular foreign operation is recognized in
profit or loss.

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D. Financial Instruments(1) Non-derivative financial assets(a) Initial recognition and measurement
The Group classifies financial assets as “financial assets measured at fair value through profit or loss”; “financial assets
measured at fair value through other comprehensive income” or “financial assets measured at amortized cost”; and thatclassification is determined at the time of initial recognition.
The Group carries out initial recognition on the date of the transaction, when it becomes party to the contract related to thefinancial asset(s).
All financial assets are measured by adding directly linked transaction costs to fair value, except those in the categoryclassified as measured at fair value through profit or loss.
Financial assets are classified as financial assets measured at amortized cost, if the following requirements are satisfied:• Assets are held based on a business model that requires them to be held to collect contractual cash flow
• Cash flow, made up solely of payment of the principal and interest on the balance of principal, is generated on a specified
day under the contractual terms of the financial asset.
Financial assets other than financial assets measured at amortized cost are classified as financial assets measured at fairvalue. Apart from equity instruments held for trading purposes, which must be measured at fair value through Profit or Loss,other equity instruments measured at fair value are designated as either being measured at fair value through Profit or Lossor alternatively measured at fair value through Other Comprehensive Income; this is done for each individual equity
instrument and the designation is continuously applied to the instrument thereafter.
(b) Subsequent measurement
Measurement after the initial recognition of financial assets is carried out as follows in accordance with the classification.
(i) Financial assets measured at amortized cost
Financial assets measured at amortized cost are measured at amortized cost using the effective interest method.
(ii) Financial assets measured at fair value
The fluctuation in the fair value of financial assets measured at fair value is recognized as profit or loss. However, any
fluctuation in the fair value of equity financial instruments designated as instruments to be measured at fair value throughother comprehensive income, is recognized as other comprehensive income; and if recognition is suspended or if the fairvalue significantly drops, then it is transferred to Retained earnings. Note that dividends from the financial assets arerecognized as profit or loss as part of finance income.

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(c) Impairment of financial assets
For financial assets measured at amortized cost, expected credit losses pertaining to the financial assets are recognized asallowances for doubtful accounts.
On each reporting date, the credit risk pertaining to each financial asset is evaluated to see if it has increased significantly
since initial recognition and, if it has, then the expected credit losses for the entire period are recognized as an allowance for
doubtful accounts; whereas if it has not, then the expected credit losses for a 12-month period are recognized as an allowancefor doubtful accounts.
At the time of an evaluation, if the contractual payment due date has passed then, in principle, it will be assumed that thecredit risk has significantly increased; however, when the evaluation takes place, other information that can be reasonably
used and used as support is taken into account.
However, trade receivables, etc., that do not include any major financial elements are always recognized as being an amountequivalent to expected credit loss for the entire period. If the issuer or debtor is in serious financial difficulties or is subject toa legal or formal business failure, then it is judged that there has been a default on obligations. And if it is judged that there
has been a default on obligations, then the assets are treated as credit-impaired financial assets.
Irrespective of the above, if it is reasonably judged that all or part of financial assets cannot be collected due to our legal
rights of claim being terminated or similar, then the book value of the financial assets is directly amortized.
(d) Derecognition of financial assets
The Group derecognizes a financial asset only if the contractual rights to the cash flows from the financial asset expire or if
the Group has transferred almost all risks and rewards of ownership. If the Group maintains control of the transferredfinancial asset, it recognizes the asset and associated liabilities to the extent of its continuing involvement.
(2) Non-derivative financial liabilities(a) Initial recognition and measurement
Corporate bonds and loans, etc., are initially recognized by the Group on their effective date; and other financial liabilities
are initially recognized on their transaction date. Financial liabilities are either classified as financial liabilities measured atfair value through profit or loss or financial liabilities measured at amortized cost, and this classification is determined at thetime of initial recognition. All financial liabilities are initially measured at fair value, but financial liabilities measured atamortized cost are measured using the amount obtained after deducting directly attributable transaction costs.
(b) Subsequent measurements
For measurements made after the initial recognition of a financial liability, any financial liabilities measured at fair value
through profit or loss include financial liabilities held for trading purposes and financial liabilities specified at the time ofinitial recognition as measured at fair value through profit or loss; and when these liabilities are measured at fair value after
initial recognition, any changes are recognized as profit or loss for the current period. Any financial liabilities measured atamortized cost are measured after initial recognition at amortized cost using the effective interest method. Any gains orlosses made in the event of amortization using the effective interest method and the de-recognition of a liability arerecognized as profit or loss for the current period as part of finance costs.
(c) Derecognition of financial liabilities
The Group derecognizes a financial liability when it is extinguished, that is, when the obligation specified in the contract iseither discharged, cancelled, or expired.
(3) Presentation of financial assets and financial liabilities
The balance of financial assets and financial liabilities is offset on the consolidated statement of financial position and the net
amount is presented only in cases in which the Group has the right to legally enforce offsetting the balances and also intends
to settle the net amount, or realize assets and settle liabilities, at the same time.

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(4) Derivative financial instruments and hedge accounting
The Group uses derivative financial instruments, such as forward currency contracts, to hedge its foreign currency risks. Suchderivative financial instruments are initially recognized at fair value on the date on which a derivative contract is entered into
and are subsequently re-measured at fair value. Derivatives are carried as financial assets when the fair value is positive andas financial liabilities when the fair value is negative.
Any gains or losses arising from changes in the fair value of derivatives are taken directly to profit or loss, except for theeffective portion of cash flow hedges, which is recognized in other comprehensive income and later reclassified to profit orloss when the hedge item affects profit or loss.
At the inception of a hedge relationship, the Group formally designates and documents the hedge relationship to which theGroup wishes to apply hedge accounting and the risk management objectives and strategy for undertaking the hedge. The
documentation includes identification of the specific hedging instrument, the hedged item or transaction, the nature of the risk
being hedged, and how the entity will assess the hedging instrument’s effectiveness in offsetting the exposure to changes in
the hedged item’s fair value or cash flows attributable to the hedged risk. Such hedges are expected to be highly effective inachieving offsetting changes in fair value or cash flows and are assessed on an ongoing basis to determine that they actually
have been highly effective throughout the financial reporting periods for which they were designated.
The Group has designated forward currency contracts as cash flow hedges and are accounted for as described below:
Cash flow hedges
For gains and losses on hedges, effective portions are recognized as other comprehensive income, and non-effective portions
are immediately recognized as profit or loss on the Consolidated Statement of Profit or Loss.
Amounts pertaining to hedges that are included as other comprehensive income are transferred to profit or loss at the point intime when the hedged trades have an impact on profit or loss. If a transaction is planned that will generate recognition ofhedged assets or liabilities of a non-financial nature, then the amount that is recognized as other comprehensive income isprocessed as a correction of the initial book value for the non-financial asset or liability.
If the forecast transaction or firm commitment is no longer expected to occur, cumulative profit or loss amounts previously
recognized in equity through other comprehensive income are reclassified as profits or losses. If the hedging instrument
expires or is sold, is terminated or exercised without replacement or rollover, or if its designation as a hedge is revoked, theamounts previously recognized in equity through other comprehensive income are recorded as equity until the forecast
transaction occurs or firm commitment is met.
E. Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, bank deposits available for withdrawal on demand, and short-term, highly
liquid investments due with a maturity of three months of the acquisition date or less that are readily convertible to cash andwhich are subject to an insignificant risk of changes in value.
F. Inventories
Inventories are valued at the lower of cost and net realizable value; the weighted average method is principally used todetermine cost. Net realizable value is based on the estimated selling price in the ordinary course of business less any estimatedcosts to sell.

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G. Property, plant and equipment(1) Recognition and measurement
Property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment losses.
The cost of an item of property, plant and equipment comprises its purchase price and any directly attributable costs ofbringing the asset to its working condition and location for its intended use, the initial estimate of the costs of dismantling andremoving the item and restoring the site on which it is located.
(2) Depreciation
Assets other than land and construction in progress are depreciated using the straight-line method over the estimated useful
lives shown below:
Buildings and structures
Machinery and equipment

3-30 years
10 years

Furniture, fixtures and vehicles

5 years

The useful lives, residual values, and depreciation methods are reviewed at each reporting date, with the effect of any changes
in estimates being accounted for on a prospective basis.
H. Goodwill and intangible assets(1) Goodwill
Goodwill is stated at the carrying amount, which is the acquisition cost after deducting accumulated impairment losses.
Goodwill represents the excess amount of the historical cost of an interest acquired by the Group over the net amount of thefair value of the identifiable assets acquired and liabilities assumed.
Goodwill is not amortized but is allocated to identifiable CGU based on the geographical region where business takes place
and the type of business conducted, and then tested for impairment each year or when there is an indication that it may be
impaired. Impairment losses on goodwill are recognized in the consolidated statement of profit or loss and cannot be
subsequently reversed in future periods.
(2) Intangible assets
Intangible assets are measured at cost, with any accumulated amortization and accumulated impairment losses deducted fromthe historical cost to arrive at the stated carrying amount.
Intangible assets acquired separately are measured at cost at initial recognition, and the cost of intangible assets acquired in abusiness combination is measured as fair value at the acquisition date.
For internally generated intangible assets, the entire amount of the expenditure is recorded as an expense in the period inwhich it arises, except for development expenses that meet the requirements for capitalization.
Intangible assets with finite useful lives are amortized over their respective estimated useful lives using the straight-line
method, and they are tested for impairment when there is an indication that they may be impaired. The estimated useful life
and amortization method for an intangible asset with a finite useful life is reviewed at the end of each reporting period, andany changes are applied prospectively as a change in accounting estimate.
The estimated useful lives of the main intangible assets with finite useful lives are as follows:• Software for internal use

Length of time it is usable internally (3 to 5 years)

Intangible assets with indefinite useful lives and intangible assets that are not yet available for use are not amortized. They aretested for impairment annually or when there is an indication that they may be impaired, either individually or at the CGU
level.

－95 －I. Leases(i) As Lessee
Right-of-use assets are initially measured at cost at the commencement date of their lease. The cost includes the amount of theinitial measurement of the lease liability, any lease payments made at or before the commencement date, less any lease
incentives received, and any initial direct costs incurred.
After the initial measurement, right-of-use assets are depreciated over the lease term using the straight-line method. The leaseterm is determined as the non-cancellable period together with periods covered by an option to terminate the lease if the lessee
is reasonably certain not to exercise that option. The right-of-use assets are measured at cost less accumulated depreciation andany accumulated impairment losses.
Lease liabilities are initially measured at the present value of the lease payments that are not paid at the commencement date. The
lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot
be readily determined, the incremental borrowing rate is used.
The lease payments included in the measurement of the lease liability comprise the fixed payments and payments of penalties forterminating the lease, if the lease term reflects the exercising an option to terminate the lease.
Subsequent to initial recognition, lease liabilities are measured at amortized cost using the effective interest method. Leaseliabilities are remeasured if there is a change in future lease payments resulting from a change in an index or a rate, or a change
in the assessment of possibility of exercising a termination option.
If a lease liability is remeasured, the amount of the remeasurement of the lease liability is recognized as an adjustment to theright-of-use asset.
(ii) As Lessor
For leases where the Group is the lender, each lease is classified as either a finance lease or an operating lease at the time thatthe lease is agreed.
In classifying each lease, the Group comprehensively evaluates whether or not the risks and economic value associated withownership of the underlying assets all transfer substantively. If they do transfer, the lease is classified as a finance lease;otherwise, it is classified as an operating lease.
Leases in which the Group acts as lender all correspond to subleases in which the Group acts as an intermediate lender. Headleases and subleases are accounted separately. In its consolidated financial statement, the Group includes lender finance leases
pertaining to relevant subleases in "other current financial assets and "non-current financial assets."

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J. Impairment
The carrying amounts of the Group’s non-financial assets, excluding inventories and deferred tax assets, are reviewed todetermine whether there is any indication of impairment at each reporting date. If there is any indication of impairment, therecoverable amount for the asset is estimated. For goodwill, intangible assets with indefinite useful lives, and intangible assetsthat are not yet available for use, the recoverable amount is estimated each year at the same time.
The recoverable amount for an asset or CGU is the higher of value-in-use and fair value less costs of disposal. The fair valueless costs of disposal calculation is based on current market transactions. However, if the observable market transactions are notavailable, appropriate valuation model is used. In assessing value-in-use, the estimated future cash flows are discounted to theirpresent value using a pre-tax discount rate that reflects the time value of money and the risks specific to the asset.
A CGU is the smallest identifiable group of assets which generates cash inflows from continuing use which are largely
independent of the cash inflows from other assets or groups of assets.
The CGU (or group of CGUs) for goodwill is determined based on the unit by which the goodwill is monitored for internalmanagement purposes and must not be larger than an operating segment before aggregation.
Because the corporate assets do not generate independent cash inflows, if there is an indication that corporate assets may be
impaired, the recoverable amount is determined for the CGU to which the corporate assets belong.
If the carrying amount of an asset or a CGU exceeds the recoverable amount, an impairment loss is recognized in profit or loss
for the period. Impairment losses recognized in relation to a CGU are first allocated to reduce the carrying amount of any
goodwill allocated to the CGU and then allocated to the other assets of the CGU pro rata on the basis of their carrying amounts.
An impairment loss related to goodwill cannot be reversed in future periods. Previously recognized impairment losses on assets
other than goodwill are reviewed at each reporting date to determine whether there is any indication that a loss has decreased or
no longer exists. A previously recognized impairment loss is reversed only if there has been a change in the assumptions used todetermine the asset’s recoverable amount since the last impairment loss was recognized. The reversal is limited so that thecarrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been
determined, net of depreciation, had no impairment loss been recognized for the asset in prior years.
K. Provisions
Provisions are recognized when the Group has a present legal or constructive obligation as a result of a past event, it is probablethat an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate canbe made of the amount of the obligation. Provisions are recognized as the best estimate of the expenditure required to settle thepresent obligation (future cash flows), taking into account the risks and uncertainties surrounding the obligation at eachreporting date.
If the time value of money is material, provisions are measured as the estimated future cash flows discounted to the present
value using a pre-tax rate that reflects, when appropriate, the time value of money and the risks specific to the liability. Whendiscounting is used, the increase due to the passage of time is recognized as a finance cost.
Provision is described below:
Asset retirement obligations
The obligations to restore property to its original state under real estate leasing agreements for offices, such as corporate
headquarters and stores, are estimated and recorded as a provision. The expected length of use is estimated as the time fromacquisition to the end of the useful life, and discount rates ranging between (0.32)-1.00% are generally used in calculations.

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L. Employee benefits(1) Defined contribution system
We have adopted a defined contribution pension plan for employees of the Company and certain subsidiaries.
The defined contribution pension plan is a post-retirement benefit plan in which the employer contributes a certain amount ofcontributions to other independent companies and is not subject to legal or presumptive obligation on payment beyond thosecontributions.
Contributions to the defined contribution pension plan are charged to expense during the period in which employees provide
services.
(2) Short-term employee benefits
For short-term employee benefits, no discount calculation is made and expenses are recorded when employees provide related
services.
For bonuses and paid leave expenses, we have legal or presumptive obligations to pay them and recognize as liabilities theamount estimated to be paid based on those plans if reliable estimates are possible.
(3) Share-based payments
The Group grants share-based payments in the form of share subscription rights (stock options) to employees of the Company
and its subsidiaries. In doing so, the Group aims to heighten morale and motivate employees to improve the Group’s businessperformance, thereby increasing shareholder value by reinforcing business development that is focused on the interests of theshareholders. These share-based payments do this by rewarding contributions to the Group’s profit and by connecting thebenefits received by these individuals to the Company’s stock price.
Stock options are measured at fair value based on the price of the Company’s shares on the grant date. Fair value of stock
options is further disclosed in “29. Share-based Payments.”
The fair value of the stock options determined at the grant date is expensed, together with a corresponding increase in capitalsurplus in equity, over the vesting period on a straight-line basis, taking into consideration the Group’s best estimates of thenumber of stock options that will ultimately vest.

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M. Revenue recognition
The Group recognizes revenue in accordance with IFRS 15 Revenue from Contracts with Customers by applying the following
five-step approach:
Step 1: Identify the contract(s) with a customer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation
The Group, as a global clothing retailer, recognizes revenue when it satisfies its performance obligation by transferring thepromised goods to the customer. An asset is transferred when the customer obtains control of that asset. In addition, the Group
recognizes revenue at the amount of the promised consideration that the customer would pay in accordance with a contract, lessthe sum of discounts, rebates and refunds or credits.
N. Income taxes
Income taxes comprise current and deferred taxes and these are recognized in profit or loss, except taxes arising from items thatare recognized as other comprehensive income.
Current taxes are measured at the amount expected to be paid to (or recovered from) taxation authorities on taxable income orloss for the current year, using the rates that have been enacted or substantively enacted by each reporting date in the countries
where the Group operates and generates taxable income, with adjustments to tax payments in past periods.
Through the use of an asset and liability approach, deferred tax assets and liabilities are recorded for the temporary differences
between the carrying amounts of assets and liabilities for accounting purposes and the amounts of assets and liabilities for tax
purposes. Deferred tax assets and liabilities are not recognized for temporary differences under any of the following
circumstances:• Temporary differences arising from goodwill;•Temporary differences arising from the initial recognition of an asset / liability which, at the time of the transaction, does notaffect either the accounting profit or the taxable income (other than in a business combination); or•Temporary differences associated with investments in subsidiaries, but only to the extent that it is possible to control the timingof the reversal of the differences and it is probable that the reversal will not occur in the foreseeable future.
The consolidated taxation system is applied for the Company and 100% owned subsidiaries in Japan.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the temporary
difference is realized or settled, based on tax laws that have been enacted or substantively enacted by each reporting date.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities
and when income taxes are levied by the same taxation authority on either the same taxable entity or on different taxable
entities which intend either to settle current tax assets and liabilities on a net basis, or to realize the assets and settle theliabilities simultaneously.
Deferred tax assets are recognized for unused tax losses, tax credits, and deductible temporary differences to the extent that it isprobable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at eachreporting date and reduced to the extent that it is no longer probable that the related tax benefits will be realized.

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O. Earnings per share
Basic earnings per share is calculated by dividing profit or loss attributable to common shareholders of the Parent by theweighted-average number of common stocks outstanding during the period, adjusted for treasury stock. Diluted earnings per
share is calculated by adjusting for all dilutive potential ordinary shares having a dilutive effect.
4. Newly applied standards and interpretation guidelines
The Group shall apply the written standards below, with effect from the current consolidated accounting year.
IFRS

Title

IFRS 16

Summary
Amendments to accounting treatment for COVID-19-related
rent concessions

LeasesApplication of amendments to IFRS 16 Leases
In accordance with the amendment to IFRS 16 Leases (“IFRS 16”) issued in May 2020, rent concessions arising as a direct resultof the COVID-19 pandemic were not being considered as lease modifications, and were accounted for as variable lease payments.
In conjunction with the amendment to paragraph 46B(b) of IFRS 16 issued in March 2021, similar rent concessions are continued
to be accounted in a same way if all of the following conditions are met
・The change in lease payments results in revised consideration for the lease that is substantially the same as, or less than, theconsideration for the lease immediately preceding the change・Any reduction in lease payments affects only payments originally due on or before 30 June 2022.
・There is no substantive change to other terms and conditions of the lease.
Any recognized gains or losses from rent concessions, that are not accounted for as lease modification, did not have asignificant impact on the Group's consolidated financial statements.
5. Issued but not yet effective IFRS, not-yet-applied new standards and interpretation guidelines
New written standards and new interpretation to existing standards guidelines that were either newly established or revised by thedate the consolidated financial statements were approved, the main standards that the Company has not applied, as of 31 August
2021, are stated below.
IFRS

Title

International AccountingStandards (“IAS”) 12

IncomeTaxes

Mandatory
adoption date(year beginning on)

The Group’s
adoption dateFiscal year ending
31 August 2024

1 January 2023

Summary
Deferred tax related to assets
and liabilities arising from asingle transaction

The Company is in the process of assessing the impact of the adoption of the above standards on the Group’s consolidated
financial statements.

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6. Segment Information
A. Description of reportable segments
The Group’s reportable segments are components for which discrete financial information is available and reviewed regularly
by 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, UNIQLOInternational, 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

UNIQLOInternational:

UNIQLO clothing business outside of JapanGU:
Global Brands:

GU brand clothing business in Japan and overseas
Theory, PLST, COMPTOIR DES COTONNIERS, PRINCESSE TAM.TAM, and J Brand clothing

operations
J Brand Inc. has been excluded from the Fast Retailing Group consolidated scope following the completion of corporate
liquidation proceedings on 5 August 2021.
B. Method of accounting for segment revenue and results
The methods of accounting for the reportable segments are the same as those stated in “3. Significant Accounting Policies.”
The Group does not allocate assets and liabilities to individual reportable segments.
C. Segment information
Year ended 31 August 2020
(Millions of yen)
Reportable segments
Total

Others(Note1)

Consolidated
Adjustments
Statement of(Note2)
Profit or Loss

UNIQLOJapan

UNIQLOInternational

GU

GlobalBrands

Revenue

806,887

843,937

246,091

109,633

2,006,550

2,295

-

2,008,846

Operating profit/(loss)

104,686

50,234

21,835(12,743)

164,013(81)(14,585)

149,347

Segment income/(loss)(i.e., profit/(loss) before income
taxes)

104,648

50,417

21,581(13,226)

163,421(79)(10,473)

152,868

Depreciation and amortization

52,99770,524

21,574

10,473

155,569

11

22,267

177,848

Impairment losses (Note 3)

2,413

15,847

1,305

3,523

23,09013(28)

23,074

Other disclosure:(Note 1) “Others” includes the real estate leasing business, etc.
(Note 2) “Adjustments” primarily includes revenue and corporate expenses which are not allocated to individual reportable segments.
(Note 3) Details on the Impairment losses are stated in note “15 Impairment losses”.

－

101 －

Year ended 31 August 2021
(Millions of yen)
Reportable segments
Total

Consolidated
Adjustments
Statement of(Note2)
Profit or Loss

Others(Note1)UNIQLOJapan

UNIQLOInternational

GU

GlobalBrands

Revenue

842,628

930,151

249,438108,204

2,130,423

2,569

-

2,132,992

Operating profit/(loss)

123,243

111,203

20,175(1,637)

252,98591(4,065)

249,011

Segment income/(loss)(i.e., profit/(loss) before income
taxes)

125,888

109,475

20,075(2,093)

253,345

93

12,432

265,872

Depreciation and amortization

52,717

69,326

19,915

9,107

151,067

926,833

177,910

Impairment losses (Note 3)

4,697

7,755

1,500

3,139

17,092-(183)

16,908Other disclosure:(Note 1) “Others” includes the real estate leasing business, etc.
(Note 2) “Adjustments” primarily includes revenue and corporate expenses which are not allocated to individual reportable segments.
(Note 3) Details on the Impairment losses are stated in note “15. Impairment losses”.
D. Geographic Information
Year ended 31 August 2020
(1) External revenue(Millions of yen)
Japan

PRC
1,082,243

Overseas (Others)
380,998

Total

545,604

2,008,846(2) Non-current assets (excluding financial assets, investments in associates accounted for using the equity method and deferred
tax assets)(Millions of yen)
United Statesof America

Japan
343,489

Overseas (Others)
82,468

Total

192,418

618,376

Year ended 31 August 2021
(1) External revenue(Millions of yen)
Japan

PRC
1,119,207

Overseas (Others)
457,571

Total

556,213

2,132,992(2) Non-current assets (excluding financial assets, investments in associates accounted for using the equity method and deferred
tax assets)(Millions of yen)
United Statesof America

Japan
351,808

Overseas (Others)
69,547－

218,910

102 －

Total
640,266

7. Business Combination
In the Group, there are no significant transactions both individually and in the aggregate, and the information is omitted.
8. Cash and Cash Equivalents
The breakdown of cash and cash equivalents as at each year end is as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Cash and bank balances

947,566

1,031,286

Money market funds (MMF), negotiable certificates of deposits

145,965

146,449

1,093,531

1,177,736

Total
9. Trade and Other Receivables
The breakdown of trade and other receivables as at each year end is as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Accounts receivable - trade55,19541,072Other accounts receivable

10,9198,405

Lease receivable

1,499

1,514

Allowance for doubtful accounts

(544)

(445)

67,06950,546Total

See note “30. Financial Instruments” for credit risk management and the fair value of trade and other receivables.
The above classifications of financial assets are all financial assets measured at amortized cost.
The above Accounts receivable — trade are mainly recognized as revenue at the time of delivery of the clothing because thecustomer is deemed to have gained control of the clothing and the performance of obligations to have been fulfilled upondelivery. The Group receives payment within a short period of time after fulfilling the performance of obligations based on
separately specified payment conditions. Because the period from fulfillment of the performance obligations to receipt ofconsideration is normally within one year, the receivables are not adjusted as material financial elements using the convention
method.

－103 －10. Inventories
The breakdown of inventories as at each year end is as follows:(Millions of yen)

Products
Materials and supplies
Total

As at
31 August 2020

As at
31 August 2021

411,563

389,104

5,965

5,763

417,529394,868(Note) As at 31 August 2020 and 31 August 2021, the Group had inventories attributable to UNIQLO Japan, UNIQLO International
and GU business segments aggregated to 390,569 million yen and 374,595 million yen, respectively.
No inventories were pledged as collateral to secure debt.
Write-down of inventories to net realizable value is as follows:(Millions of yen)

Write-down of inventories to net realizable value

Year ended
31 August 2020

Year ended
31 August 2021

10,02015,120(Note) As at 31 August 2020 and 31 August 2021, the Group had write-down of inventories to net realizable value from UNIQLO
Japan, UNIQLO International and GU business segments aggregated to 7,389 million yen and 13,038 million yen, respectively.

－

104 －

11. Other Financial Assets and Other Financial Liabilities
The breakdowns of other financial assets and other financial liabilities as at each year end are as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Security deposits / guarantees

63,63964,502

Bank deposits

45,91650,516

Others

7,584

7,470

Allowance for doubtful accounts

(850)

(219)

1,370

1,008

117,660

123,279

Other current financial assets total

49,89056,157

Other non-current financial assets total

67,77067,122Other financial assets:
Financial assets measured at amortized cost

Financial assets measured at fair value throughother comprehensive income
Stocks
Total(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Interest-bearing bank and other borrowings (Note)

484,496382,634

Deposits

98,15691,805

Deposits / guarantees received

1,428

1,328

584,082475,768

Other current financial liabilities total

213,301

104,969

Other non-current financial liabilities total

370,780

370,799

Other financial liabilities:
Financial liabilities measured at amortized cost

Total

(Note) Interest-bearing bank and other borrowings include corporate bonds and loans payable.

－

105 －

The issues and fair values of financial assets measured at fair value through other comprehensive income are as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Crystal International Group Ltd.

591

808

Matsuoka Corporation

566-

Issue(s)Stocks are principally held to strengthen medium-term relationships with strategic partners, and are therefore designated as
financial assets at fair value through other comprehensive income.
The fair value and cumulative gains or losses (before tax effects) as at the date of derecognition of financial assets measured atfair value through other comprehensive income that were derecognized during the period are as follows.
(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Fair value-

883

Cumulative gains / (losses)-

739(Notes) 1. The Group sells off (derecognizes) equity instruments measured at fair value through other comprehensive income based on
the efficient utilization of assets and reviews of business relationships.
2. If equity instruments measured at fair value through other comprehensive income are derecognized, cumulative gains orlosses (after tax effects) recognized in other comprehensive income are transferred to retained earnings.
Dividend income recognized in financial assets measured at fair value through other comprehensive income is as follows.
(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Derecognized financial assets--

Financial assets held at the end of the fiscal year

50

39

－

106 －

12. Other Assets and Other Liabilities
The breakdowns of other assets and other liabilities as at each year end are as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Prepayments

8,246

8,683

Long-term prepayments

2,662

2,534

Others

7,104

10,57218,013

21,790Current

10,62915,270Non-current

7,383

6,520

Other assets:

Total(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Accruals

57,33868,797

Employee benefits accruals

8,146

8,520

Suspense receipt / accrued consumption tax

1,396

9,861

Others

18,28010,81485,16097,994Current

82,63695,652

Non-current

2,524

2,342

Other liabilities:

Total

－

107 －

13. Property, Plant and Equipment
Increase / (decrease) in acquisition costs, accumulated depreciation and impairment of property, plant and equipment are as follows:(Millions of yen)
Acquisition costs

Buildings
andstructures

Machineryandequipment

Furniture,
fixtures andvehiclesLand

Construction
inprogress

LeasedassetsTotal

At 1 September 2019

265,88520

57,501

1,962

10,40457,409393,184

-

-

-

-

-

(57,409)(57,409)265,88520

57,501

1,962

10,404-

335,774

Additions

1,886

271

42

-

43,784-45,986

Disposals(10,896)-(2,994)

-

(160)

-

(14,051)

Transfers

33,457

101

7,535

-

(41,094)

-

-

2,927

12

453

-

286

-

3,678

293,259

405

62,5391,962

13,220-371,388

Additions

6,946

341

106

-

57,305-64,700

Disposals(14,373)(5)(5,206)-(1,086)-(20,672)

Transfers

29,803

10,717

11,681-(52,201)

-

-

8,941

173

3,593

-

1,120

-

13,829324,577

11,63372,713

1,962

18,358-429,245

Effect of change inaccounting policy
At 1 September 2019
(After adjustment)

Effect of change inexchange rate
At 31 August 2020

Effect of change inexchange rate
At 31 August 2021

－

108 －

(Millions of yen)
Accumulated
depreciationand impairment

Buildings
andstructures

Machineryandequipment

Furniture,
fixtures andvehiclesConstruction
inprogress

At 1 September 2019

(171,242)(3)(40,425)

(34)

-

-

-

At 1 September 2019
(After adjustment)(171,242)(3)

Depreciation provided
during the year

(22,966)

Impairment losses
Disposals

LeasedassetsTotal-(19,385)(231,092)--

19,385

19,385(40,425)

(34)

-

-

(211,706)(13)(7,385)---(30,365)(3,715)

-

(655)

-

-

-

(4,370)

9,938

-

2,735

-

-

-

12,674(1,165)

-

(330)

-

-

-

(1,496)(189,150)(17)(46,061)

(34)

-

-

(235,265)(24,217)(393)(7,699)---(32,310)

Impairment losses(1,895)

-

(417)

-

-

-

(2,313)

Disposals

13,243

2

4,865

-

-

-

18,112

Effect of change inexchange rate

(6,436)(8)(2,847)---(9,292)

At 31 August 2021

(208,457)(416)(52,159)

(34)

-

-

(261,068)

Effect of change inaccounting policy

Effect of change inexchange rate
At 31 August 2020
Depreciation provided
during the year

Land

(Millions of yen)
Net carrying amount

Buildings
and structures

Machineryandequipment

Furniture,
fixtures andvehiclesLand

Construction
inprogress

Total

At 31 August 2020

104,108388

16,477

1,927

13,220136,123

At 31 August 2021

116,120

11,216

20,553

1,927

18,358168,177(Notes) 1. The Group had store assets attributable to UNIQLO Japan, UNIQLO International and GU business segments.
2. There are no restrictions on ownership rights and no pledges on the Group’s property, plant and equipment.
3. “Machinery and equipment” that was included in “Buildings and structures” and “Furniture, fixtures and vehicles” isseparately presented from the current fiscal year due to its increased materiality. As a result, “Furniture, fixtures andvehicles” for the previous fiscal year was reclassified to “Machinery and equipment”.

－

109 －

14. Goodwill and Intangible Assets
A. The increase / (decrease) in acquisition costs, accumulated amortization, and impairment of goodwill and intangible assets are
as follows:(Millions of yen)
Intangible assets other than goodwill
Acquisition costs

Goodwill

GoodwillandIntangible
assets total

SoftwareTrademarks

Otherintangible
assetsTotal

38,754

94,57820,686

21,950137,215

175,970

External purchases-

21,34933

1,693

23,076

23,076

Disposals

-

(626)

-

(118)

(744)

(744)

Effect of change in exchange rate

(231)

123

(202)

(412)

(491)

(723)

At 31 August 2020

38,522

115,426

20,517

23,112

159,056

197,578

External purchases-

19,291

164551

20,00820,008(23,782)(520)(12,310)(13,565)(26,396)(50,178)

Effect of change in exchange rate

1,144

81

808

(678)

211

1,356

At 31 August 2021

15,885

134,279

9,179

9,419

152,879

168,764

At 1 September 2019

Disposals(Millions of yen)
Intangible assets other than goodwill
Accumulated amortizationand impairment

SoftwareTrademarks

Otherintangible
assetsTotal(30,661)(48,649)(13,113)(15,335)(77,097)(107,759)

Amortization provided during the year-

(13,976)-(49)(14,025)(14,025)

Impairment losses-(0)(1,312)(333)(1,646)(1,646)

Disposals

-

306

-

49

355

355

231

70

110

10

191

423

(30,429)(62,249)(14,315)(15,658)(92,222)(122,652)

Amortization provided during the year-

(17,422)-(23)(17,445)(17,445)

Impairment losses

-

(108)

(383)

(686)

(1,178)(1,178)

Disposals

23,348413

12,145

13,44726,00749,355

Effect of change in exchange rate

(710)

(17)

(580)

(501)

(1,099)(1,810)(7,792)(79,384)(3,133)(3,422)(85,939)(93,732)

At 1 September 2019

Effect of change in exchange rate
At 31 August 2020

At 31 August 2021

Goodwill

GoodwillandIntangible
assets total(Note) Amortization of intangible assets is included in “selling, general and administrative expenses” on the consolidated statement of
profit or loss.

－

110 －

(Millions of yen)
Intangible assets other than goodwill
Net carrying amount

Goodwill
SoftwareTrademarks

Otherintangible
assets

Total

GoodwillandIntangible
assets total

At 31 August 2020

8,092

53,176

6,202

7,454

66,83374,925

At 31 August 2021

8,092

54,894

6,046

5,997

66,93975,031

B. Goodwill and intangible assets with indefinite useful lives
Goodwill and intangible assets recorded in the consolidated statement of financial position are primarily for goodwill andtrademarks related to the Theory business.
Trademarks and certain other intangible assets will continue to be used as long as the business remains viable; therefore,
management estimated the useful lives as indefinite.
The carrying amount of the goodwill and intangible assets with indefinite useful lives by CGU is as follows:(Millions of yen)
Intangible assets with indefinite
useful lives

Goodwill
Net carrying amount
UNIQLOJapan

UNIQLOInternational

At 31 August 2020--

At 31 August 2021--

GlobalBrandsUNIQLOJapan

UNIQLOInternatio
nal

-

8,092

-

-

-

11,985

-

8,092

-

-

-

11,348

GU

－

111 －

GlobalBrandsGU

15. Impairment Losses
The Group recognized impairment losses on certain store assets etc., due to reductions in profitability of the respective CGU.
The breakdown of impairment losses by asset type is as follows:(Millions of yen)

Buildings and structures
Furniture, fixtures and vehicles
Subtotal impairment losses on property, plant and equipment
SoftwareTrademark (Note)
Other intangible assets
Subtotal impairment losses on intangible assets
Right-of-use assets
Other non-current assets (long-term prepayments)
Total impairment losses

Year ended
31 August 2020

Year ended
31 August 2021

3,715

1,895

655

417

4,370

2,313

0

108

1,312

383

333

686

1,646

1,178

17,041

13,41015

623,074

16,908(Note) For the year ended 31 August 2020, 612 million yen represented impairment losses on trademark of the Helmut Lang brand and
700 million yen represented impairment losses on trademark of the J Brand. For the year ended 31 August 2021, 383 million yen
represented impairment losses on trademark of the J Brand.
The Group’s impairment losses during the year ended 31 August 2021 amounted to 16,908 million yen, compared with 23,074
million yen during the year ended 31 August 2020, and are included in “Other expenses” on the consolidated statement of profit
or loss.
Year ended 31 August 2020
Property, plant and equipment and Right-of-use assets
Impairment losses amounting to 23,074 million yen, 21,411 million yen represented write downs of the carrying amounts ofstore 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 COVID-19 pandemic will continue to be felt
through to the end of August 2021.
The grouping of assets is based on the smallest identifiable CGU that independently generates cash inflow. In principle, eachstore, including flagship stores, is considered as an individual CGU and recoverable amounts thereon are calculated based onvalue 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 7.1%. Theoretically, the projected cash flows cover a five-year period, and do not use a growth ratethat exceeds the long-term average market growth rate. The pre-tax discount rate calculation is based on the weighted-average
cost of capital.

－

112 －

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

CGU

Type
Buildings, structures and Right-of-use

UNIQLO Japan

UNIQLO CO., LTD. stores

UNIQLO International

UNIQLO USA, FRL Korea Co., Ltd. etc.,
storesBuildings, structures and Right-of-use
assetsGU

G.U. CO., LTD., FRL Korea Co., Ltd. etc.,
storesBuildings, structures and Right-of-use
assets

Theory LLC.,COMPTOIR DES

Buildings, structures and Right-of-use

COTONNIERS S.A.S., etc., stores

assetsGlobal Brands

assets(Note) The total of tangible assets and right-of-use assets associated with domestic UNIQLO stores, overseas UNIQLO stores, and GU
stores for the fiscal year ended August 2020 are 120,354 million yen, 196,793 million yen, and 39,752 million yen, respectively.
Year ended 31 August 2021
Property, plant and equipment and Right-of-use assets
Impairment losses amounting to 16,908 million yen, 15,723 million yen represented write downs of the carrying amounts ofstore 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 of thestores, etc. Although the timing for the situation subsiding differs from region to region and on a case-by-case basis, we madeaccounting estimates involving the assumption that the impact will last until the end of August 2022 for most countries andregions including Japan. For stores in other certain countries and regions, it may take longer for the situation to get undercontrol.
The grouping of assets is based on the smallest identifiable CGU that independently generates cash inflow. In principle, eachstore, including flagship stores, is considered as an individual CGU and recoverable amounts thereon are calculated based onvalue in use.
The value in use is calculated based on the cash flow projections with estimates and growth rates approved by management,
applying a discount rate of mainly 8.9 %. Theoretically, the projected cash flows cover a five-year period, and do not use agrowth rate that exceeds the long-term average market growth rate. The pre-tax discount rate calculation is based on theweighted-average cost of capital.
The main CGUs for which impairment losses were recorded are as follows:
Operating segment
UNIQLO JapanCGUUNIQLO CO., LTD. stores

Type
Buildings, structures and Right-of-use
assetsUNIQLO USA, UNIQLO EUROPE LTD.

Buildings, structures and Right-of-use

etc., stores

assetsGU

G.U. CO., LTD. etc., stores

Buildings, structures and Right-of-use
assetsGlobal Brands

COMPTOIR DES COTONNIERS S.A.S.,
etc., stores

Buildings, structures and Right-of-use
assetsUNIQLO International(Note) The total of tangible assets and right-of-use assets associated with domestic UNIQLO stores, overseas UNIQLO stores, and GU
stores for the fiscal year ended August 2021 are 129,814 million yen, 205,036 million yen, and 31,599 million yen, respectively.

－

113 －

16. Investments in Associates Accounted for Using the Equity Method
A. Information on associates accounted for using the equity method
Information on associates accounted for using the equity method is as follows:(Millions of yen)

Share of profit and loss of associates accounted for using the equity method
Share of other comprehensive income / (loss) of investments in associates
accounted for using the equity method
Share of comprehensive income / (loss) of investments in associates
accounted for using the equity method
Carrying amount of investments in associates

Year ended
31 August 2020

Year ended
31 August 2021

321

561

(39)

65

281

626

14,221

18,236

B. Determination regarding significant influence and financial information on important associates
In June 2016, the Company invested in a domestic real estate investment trust aiming to own a distribution facility. The
Company has significant influence over the financial and operating policy.
The Company’s maximum exposure to losses due to its investments in the associates is limited to the amount of the investments
by the Company and is included in the consolidated statement of financial position as “Investments in associates,” whichamounted to 13,138 million yen as at 31 August 2020 and 17,250 million yen as at 31 August 2021, respectively. The Group’s
share of profit and comprehensive income of the associates was 486 million yen during the year ended 31 August 2020 and 631
million yen during the year ended 31 August 2021, which was included in the consolidated statement of profit or loss andconsolidated statement of comprehensive income, respectively.
Total assets of the associates amounted to 69,872 million yen as at 31 August 2020 and 90,622 million yen as at 31 August 2021
respectively, which mainly comprised non-current assets such as warehouse, etc. The Company invested in the associates at thetime of incorporation and no goodwill is recognized.
The Company received dividends from the associates amounting to 619 million yen during the year ended 31 August 2020 and
664 million yen during the year ended 31 August 2021, respectively.
The Group has entered into lease contracts with one of the associates relating to warehouse rental, etc.

－

114 －

17. Leases(1) Lessee
As a lessee, the Group mainly leases real estate for store use (land, buildings and structures).
A. Lease liabilities(Millions of yen)
Year ended 31 August 2020

Year ended 31 August 2021

Present value ofremaining lease

Remaining lease
payments

payments

Remaining lease
payments

Present value ofremaining lease
payments

Lease liabilities
Due within one year

115,222

114,652

120,492

117,083

Due after one year through two years

85,37083,99386,417

81,570Due after two years through three years

60,865

59,13061,48959,061

Due after three years through four years

49,84647,954

46,862

44,786

Due after four years through five years

38,52336,72428,00026,660Due after five years

130,932

123,722

137,705

131,495

480,761

466,179

480,966

460,658

Total
Interest expenses on lease liabilities(Millions of yen)
Year ended 31 August 2020
Interest expenses on lease liabilities

Year ended 31 August 2021
4,763

4,847

Cash outflow for leases
Cash outflow for leases is as follows:(Millions of yen)
Year ended 31 August 2020
Total Cash outflow for leases

200,483－

115 －Year ended 31 August 2021
219,331

B. Right-of-use assets
A breakdown of right-of-use assets is as follows:(Millions of yen)
Real estates

Machinery andFurniture, fixtures andequipment

vehiclesTotal

330,860

15,941

28,739375,541

contracts, reassessment oflease liabilities, etc.

164,901

3,449

9,599

177,950

Depreciation(120,862)(3,135)(9,459)(133,457)

Impairment losses(16,766)-(274)(17,041)

Expiration, cancellation, etc.

(2,034)-(1,084)(3,118)

442

-

(372)

69

At 31 August 2020

356,539

16,25527,148399,944

Additions due to new lease
contracts, reassessment of

116,494

18,0792,955

137,528

Depreciation(116,943)(4,411)(9,020)(130,376)

Impairment losses(13,260)-(149)(13,410)

Expiration, cancellation, etc.

(10,931)(148)(1,229)(12,310)

6,656

-

2,504

9,161

338,553

29,774

22,209390,537

At 1 September 2019
Additions due to new lease

Otherslease liabilities, etc.

OthersAt 31 August 2021

(Notes) “Machinery and equipment” that was included in “Furniture, fixtures and vehicles” is separately presented from the current
fiscal year due to its increased materiality. As a result, “Furniture, fixtures and vehicles” for the previous fiscal year was reclassified
to “Machinery and equipment”.
C. Expenses relating to Leases
A breakdown of expenses relating to Leases is as follows:(Millions of yen)
Year ended 31 August 2020
Expenses relating to variable lease payments notincluded in the measurement of lease liability
Expenses relating to short-term leases (excluding
expenses relating to leases with lease term of no
more than one month)
Expenses relating to leases of low value assets(excluding expenses relating to short-term leases)

Year ended 31 August 2021

49,41855,429

3,261

6,617

33

149

(Note) Variable lease payments are linked to sales performance which mainly relate to store opening contracts.
D. Others
The future cash outflows to which the lessee is potentially exposed that are not yet commenced to which the lessee is committed
during the year ended 31 August 2021 amounted to 40,109 million yen, compared with 11,071 million yen during the year ended 31
August 2020.
The Group's leased properties are granted a termination option for the purposes of flexible decision-making regarding store closures.
This is mainly in relation to store lease agreements, most of which have the option of early termination provided that written notice
is given to the other party six months in advance. In light of the possibility for the termination option to be exercised, the lease term
－ 116 －

is determined by setting a non-cancellable lease term as a minimum and taking a target period for return on investment for eachsegment into consideration. We continually review this assessment, should any event arise that would impact this assessment, as
well as any occurrence or situation that would cause significant changes.
(2) Lessor
The Group subleases some real estate as part of promoting its store-opening strategy. The Group receives security deposits from lessee
to collateralize risks such as non-restitution of defaults on lease payments liabilities and non-implementation of asset retirement
obligation.
A. Finance leases
The Group acts as a lessor under a finance lease, primarily for the subletting of road-side stores.
(i)Analysis of changes of lease receivables
An analysis of changes in lease receivables in relation to finance leases is as follows;(Millions of yen)
Year ended 31 August 2020

Year ended 31 August 2021

Carrying amounts at the beginningof period

4,824

4,474

Increases due to finance lease contracts

1,943

3,088

Decreases due to repayments(2,294)(2,020)0(1,644)

4,474

3,897

OthersCarrying amounts at the endof period(ii) Maturity analysis of the lease payments receivables to be reconciled to the net investment in the lease
A maturity analysis of lease payments in relation to finance leases is as follows;(Millions of yen)
Year ended 31 August 2020

Year ended 31 August 2021

Undiscounted lease payments to bereceived
Due within one year

1,499

1,514

Due after one year through two years

1,034

1,305

Due after two years through three years

792

443

Due after three years through four years

502

305

Due after four years through five years

370

171

Due after five years

345

207

4,545

3,948

Unearned finance income

71

51

Net investment in the lease

4,474

3,897

Total

－

117 －

(iii) Amount pertaining to lease receivables recognized in the Consolidated statement of profit or loss
(Millions of yen)
Year ended 31 August 2020
Finance income from net investment in theleaseYear ended 31 August 2021
37

18

B. Operating leases
The Group subleases property to its tenants under operating leases for each commercial establishment it operates.
(i) Lease income
A breakdown of income on operating leases is as follows;(Millions of yen)
Year ended 31 August 2020

Year ended 31 August 2021

Income on variable lease payments

120

88

Income on fixed lease payments

1,030

1,324

(ii) Maturity analysis of lease payments to be received
A maturity analysis of lease payments to be received in relation to operating leases is as follows;(Millions of yen)
Year ended 31 August 2020

Year ended 31 August 2021

Undiscounted lease payments to bereceived
Due within one year

1,009

1,212

Due after one year through two years

1,008

572

Due after two years through three years

533

236

Due after three years through four years

205

236

Due after four years through five years

205

236

Due after five years

530

236

3,492

2,733

Total

－

118 －

18. Deferred Taxes and Income Taxes
A. Deferred taxes
The main factors in the increase / (decrease) of deferred tax assets and deferred tax liabilities are as follows:

As at
31 August2019

Effect ofadoption of
IFRS 16

As at
1
September
2019(Millions of yen)
Recognized
Recognizedin other
Recognized
As at
in profit orcomprehens directly in 31 August
loss
ive
equity2020(Note)
incomeTemporary differences
Accrued business tax

1,819

-

1,819

(334)

-

-

1,484

Accrued for bonuses

4,642

-

4,642

(659)

-

-

3,982

172

-

172

(166)

-

-

5

3,864

-

3,864

(1,944)

-

-

1,919

186

-

186

-

(355)

-

(169)

7,402

-

7,402

238

-

-

7,640

(1,889)-(1,889)-(6,899)3,383(5,405)(1,893)-(1,893)---(1,893)(4,081)-(4,081)

4,081

-

-

-

-

13,98813,988(3,117)--

10,870

Others

10,061-

10,061

4,140

-

-

14,202

Subtotal

20,283

13,98834,272

2,236(7,255)

3,383

32,636

Tax losses carried forward

4,056

-

4,056

993

-

-

5,049

Net deferred tax assets /(liabilities)

24,34013,98838,3293,229(7,255)

3,383

37,686

Allowance for doubtful
accounts
Impairment losses on noncurrent assets
Unrealized gains / (losses)
on available-for-salesecurities
Depreciation
Net gains / (losses)
on revaluation of cash flow
hedgesTemporary differences onshares of
subsidiaries
Accelerated depreciation
Right-of-use assets / Leaseliabilities(Note) The difference between the total amount recognized in profit or loss and the amount of deferred tax is due to effect of change inexchange rate.

－

119 －

(Millions of yen)
As at
1 September
2020

Recognizedin profit or loss
(Note)

Recognizedin othercomprehensive
incomeRecognizeddirectly inequityAs at
31 August 2021

Accrued business tax

1,484

780

-

-

2,265

Accrued for bonuses

3,982

645

-

-

4,627

5

5

-

-

11

Impairment losses on
non-current assets

1,919

4,651

-

-

6,570

Unrealized gains / (losses)
on available-for-sale securities

(169)

-

104

-

(64)

Depreciation

7,640

1,512

-

-

9,152

Net gains / (losses) onrevaluation of cash flow hedges(5,405)-(12,513)

4,221(13,697)

Temporary differences on sharesof subsidiaries(1,893)---(1,893)

-

-

-

-

-

10,870

1,455

-

-

12,326

Others

14,202(9,351)

-

-

4,851

Subtotal

32,636(299)(12,408)

4,221

24,149Tax losses carried forward

5,049(1,934)

-

-

3,115

Net deferred tax assets / (liabilities)

37,686(2,234)(12,408)

4,221

27,265

Temporary differences

Allowance for doubtful accounts

Accelerated depreciation
Right-of-use assets / Leaseliabilities(Note) The difference between the total amount recognized in profit or loss and the amount of deferred tax is due to effect of change inexchange rate.
Tax effects of unrecognized tax losses carried forward and deductible temporary differences for which deferred tax assets were
not recognized is as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Unrecognized tax losses carried forward

32,071

41,382

Deductible temporary differences

11,574

12,766

43,64654,148

Total

－

120 －

Tax effects of unrecognized tax losses carried forward of which no deferred tax asset is recognized in the consolidated
statement of financial position, if unutilized, will expire as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

First year

340

167

Second year

239

289

Third year

608

266

Fourth year

333

3,183

30,54937,47532,071

41,382Fifth year and thereafter
Total

Temporary differences on shares of subsidiaries for which deferred tax liabilities were not recognized
The aggregate amounts of temporary differences associated with undistributed retained earnings of subsidiaries for which
deferred tax liabilities have not been recognized as at 31 August 2020 and 31 August 2021 were 427,747 million yen and
430,902 million yen, respectively.
Deferred tax liabilities are not recognized as the Group is able to control the timing of the reversal of the temporary difference
and it is probable that they will not reverse it in the foreseeable future.
B. Income taxes(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

Current tax

68,26387,800

Deferred tax(5,793)

2,388

62,47090,188

Total

Reconciliations between the statutory income tax rates and the effective tax rates are as follows. The effective tax rate shown isthe corporate income tax rate applied to the Group’s profit before income taxes.
Year ended
31 August 2020

Year ended
31 August 2021

Statutory income tax rate

30.6%

30.6%

Unrecognized deferred tax assets

9.1%

4.0%

Difference in statutory income tax rates of subsidiaries(2.5)%(3.0)%

Undistributed earnings of foreign subsidiaries

0.9%

1.5%

Foreign withholding tax

3.8%

1.4%

Others(1.0)%(0.6)%

Effective tax rate

40.9%

33.9%

－

121 －

19. Trade and Other Payables
The breakdown of trade and other payables as at each year end is as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Trade payables

150,749

179,988

Notes payables

12

13

Other payables

59,98440,055

210,747

220,057

Total
20. Provisions
The breakdown of provisions as at each year end is as follows:(Millions of yen)

Asset retirement obligations
Total
Current liabilities
Non-current liabilities

As at
31 August 2020

As at
31 August 2021

33,41041,19533,41041,195752

2,149

32,65839,046

The primarily factors for the increase / (decrease) in provision are as follows:(Millions of yen)
Asset retirement obligations
Balances as at 31 August 2020

33,410Additional provisions

8,487

Amounts utilized(1,377)

Increase in discounted amounts arising from passage of time

272

Others402

Balances as at 31 August 2021

41,195

Please refer to “3. Significant Accounting Policies K. Provisions” for an explanation of respective provisions.

－

122 －

21. Equity and Other Equity Items
A. Share Capital

Balances as at 1 September
2019

Number of
authorizedshares(Common stockwith no parvalue)(Shares)Number ofissued shares(Common stockwith no parvalue)(Shares)Number ofoutstanding
shares(Common stockwith no parvalue)(Shares)

300,000,000

106,073,656-

Capital stock(Millions ofyen)

Capital surplus(Millions ofyen)

102,061,735

10,273

20,603-38,808-2,761

300,000,000

106,073,656

102,100,543

10,27323,365--44,128-1,995

300,000,000

106,073,656

102,144,671

10,27325,360

Increase / (decrease) (Note)
Balances as at 31 August
2020
Increase / (decrease) (Note)
Balances as at 31 August
2021(Note) The primarily factor for the increase / (decrease) in the number of shares in circulation was the increase / (decrease) in thenumber of treasury stock as indicated below.
B. Treasury Stock and Capital Surplus(1) Treasury Stock
Number of shares(Shares)Amount(Millions of yen)

4,011,921

15,27183

5(38,891)(148)

3,973,113

15,129160

12Exercise of stock options(44,288)(168)

Balances as at 31 August 2021

3,928,985

14,973

Balances as at 1 September 2019
Acquisition of treasury stock less than one unit
Exercise of stock options
Balances as at 31 August 2020
Acquisition of treasury stock less than one unit

(2) Capital surplus(Millions of yen)
Capital reserve

Gain / (loss) on
disposalof treasury stock

Stock options

Others

Total

Balances as at 1 September
2019

4,578

6,483

5,981

3,559

20,603

Disposal of treasury stock

-

1,496

-

-

1,496

Share-based payments

-

-

1,265

-

1,265

4,578

7,980

7,246

3,559

23,365

Disposal of treasury stock

-

1,836

-

-

1,836

Share-based payments

-

-

159

-

159

4,578

9,816

7,405

3,559

25,360

Balances as at 31 August
2020

Balances as at 31 August
2021

Please refer to “29. Share-based Payments” for details of share-based payments (stock options).
－

123 －

C. Other components of equity
The breakdown of other comprehensive income included in non-controlling interests is as follows:(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

Exchange differences on translation of foreign operations

(212)

1,921

Cash flow hedges

(877)

(175)

(1,089)1,745

Other comprehensive income

D. Dividends
The Company’s basic policy is to pay dividends twice a year, an interim dividend and a year-end dividend. These dividends are
decided by resolution of the Board, unless otherwise stipulated by laws and regulations.
The total amount of dividends paid was as follows:Year ended 31 August 2020
Amount ofdividends(Millions of yen)

Resolutions

Dividends per share(Yen)

Board of Directors’ meeting held on 5 November 201924,494

240

Board of Directors’ meeting held on 9 April 2020

24,499240

Year ended 31 August 2021
Amount ofdividends(Millions of yen)

Dividends per share(Yen)

Board of Directors’ meeting held on 4 November 2020

24,504

240

Board of Directors’ meeting held on 8 April 2021

24,511240

Amount ofdividends(Millions of yen)

Dividends per share(Yen)

24,514240

Resolutions

Dividend which effective date is after fiscal 2021 is as follow:
Resolutions
Board of Directors’ meeting held on 2 November 2021

Regarding the proposed dividends per common stock, the Board has approved the proposal subsequent to the year-end date, and
it is not recognized as a liability at year end.

－

124 －

22. Revenue
A. The breakdown of revenue for each year is as follows:
The Group performs global retail clothing operations through both physical stores and e-commerce channels. The following is abreakdown of total revenue by major regional market operation.
Year ended 31 August 2020
Revenue(Millions of yen)

Percent of Total
(%)

Japan

806,887

40.2

Greater China

455,986

22.7

Other parts of Asia & Oceania

204,537

10.2

North America & Europe

183,4129.1

1,650,825

82.2

GU (Note 2)

246,091

12.3

Global Brands (Note 3)

109,633

5.5

2,295

0.1

2,008,846

100.0

UNIQLO (Note 1)

Others (Note 4)
Total(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.

－

125 －

Year ended 31 August 2021
Revenue(Millions of yen)

Percent of Total
(%)

Japan

842,628

39.5

Greater China

532,249

25.0

Other parts of Asia & Oceania

202,472

9.5

North America & Europe

195,4299.2

1,772,780

83.1

GU (Note 2)

249,438

11.7

Global Brands (Note 3)

108,204

5.1

2,569

0.1

2,132,992

100.0

UNIQLO (Note 1)

Others (Note 4)
Total(Note 1) Revenue is classified by nation or region based on customer location.
The designated countries and regions are classified as follows:
Greater China:
Other parts of Asia & Oceania:

Mainland China, Hong Kong, Taiwan
South Korea, Singapore, Malaysia, Thailand, the Philippines, Indonesia,

North America & Europe:

Australia, Vietnam, India
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.
B. Liabilities arising from contracts with customers are as stated below.
(Millions of yen)
End of current
consolidated
fiscal year
(31 August 2020)

End of current
consolidated
fiscal year
(31 August 2021)

Advances received from customers

1,391

1,572

Refund liabilities

1,445

1,558

Contractual liabilities

Consideration for anticipated refunds to customers is reasonably estimated and recognized as a refund liability.
In the consolidated statement of financial position, liabilities pertaining to advances received and refunds from customers areincluded in “Other current liabilities.”
C. Transaction prices allocated to existing performance obligations
In the Group, there are no significant transactions for which the individual forecast contract period exceeds one year.
Therefore, the practical short-cut method is used, and information related to remaining performance obligations is omitted.
Furthermore, in the consideration arising from contracts with customers, there are no significant monetary amounts that are notincluded in the transaction price.
D. Assets recognized from costs for acquiring or performing contracts with customers
In the Group, there are no assets recognized from costs for acquiring or performing contracts with customers.

－

126 －

23. Selling, General and Administrative Expenses
The breakdown of selling, general and administrative expenses for each year is as follows:(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

Advertising and promotion

68,307

66,576

Lease expenses

53,61762,494

Depreciation and amortization

177,848

177,910

Outsourcing

49,68650,320

Salaries

277,556

285,361

Distribution

94,01891,375

Others

84,78784,389805,821

818,427

Selling, general and administrative expenses

Total
24. Other Income and Other Expenses
The breakdowns of other income and other expenses for each year are as follows:(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

1,576

2,912

-

8,708

6,378

6,617

7,954

18,238Other income
Foreign exchange gains (Note 1)
Gain on reclassification of foreign exchange differences on translation offoreign operations (Note 2)
Others
Total(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

Losses on retirement of property, plant and equipment

1,125

985

Impairment losses

23,074

16,908Others

4,752

7,421

28,952

25,315

Other expenses

Total(Note 1) Currency adjustments incurred in the course of operating transactions are included in “Other income”.
(Note 2) The amount represents gain reclassified to profit and loss due to the liquidation of J Brand, Inc. during the year ended 31
August 2021.

－

127 －

25. Finance Income and Finance Costs
The breakdowns of finance income and finance costs for each year are as follows:(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

Foreign exchange gains (Note)

1,503

19,222

Interest income

9,673

4,589

50

47

11,22823,859Finance income

Others
Total(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

7,706

6,990

1

7

7,707

6,998

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

－

128 －

26. Other Comprehensive Income
The breakdown of amounts recorded during the year, reclassification adjustments, and income tax effect generated by individualcomprehensive income items included in “Other comprehensive income” for each year are as follows:Year ended 31 August 2020
(Millions of yen)Amountrecordedduring the year

Reclassification
adjustment

Amount before
income taxes

Income taxes

Amount after
income taxes

Items that will not bereclassified subsequently
to profit or loss
Financial assets measured
at fair value throughother comprehensive

(275)

-

(275)

(355)

(630)

(275)

-

(275)

(355)

(630)

5,227

-

5,227

-

5,227

26,185(5,155)21,029(6,899)14,130

(39)

-

(39)

-

(39)

31,373(5,155)

26,217(6,899)19,31831,098(5,155)25,942(7,255)

18,687

income / (loss)
Total
Items that may bereclassified subsequently
to profit or loss
Exchange differences ontranslation of foreign
operations
Cash flow hedges
Share of othercomprehensive incomeof associates
Total
Total comprehensive income
for the year

(Note) The cash flow hedge reclassification adjustment of 5,155 million yen is the amount transferred to profit or loss after hedge
accounting was suspended, as a forecast transaction eligible for hedge accounting was no longer expected to occur.
There is no transfer amount for the previous consolidated fiscal year.

－

129 －

Year ended 31 August 2021
(Millions of yen)Amountrecordedduring the year

Reclassification
adjustment

Amount before
income taxes

Income taxes

Amount after
income taxes

436

-

436

104

541

436

-

436

104

541

28,975(8,708)20,266-

20,266

38,644203

38,847(12,513)

26,333

65

-

65

-

65

67,684(8,505)59,179(12,513)

46,665

68,121(8,505)59,616(12,408)

47,207

Items that will not bereclassified subsequently
to profit or loss
Financial assets measured
at fair value throughother comprehensive
income / (loss)
Total
Items that may bereclassified subsequently
to profit or loss
Exchange differences ontranslation of foreign
operations
Cash flow hedges
Share of othercomprehensive incomeof associates
Total
Total comprehensive income
for the year

(Note) The exchange differences on translation of foreign operations reclassification adjustment of (8,708) million yen is the amounttransferred to profit or loss due to the liquidation of J Brand, Inc. during the year ended 31 August 2021.
In addition, the cash flow hedge reclassification adjustment of 203 million yen is the amount transferred to profit or loss after hedge
accounting was suspended, as a forecast transaction eligible for hedge accounting was no longer expected to occur. There is notransfer amount for the previous consolidated fiscal year.

－

130 －

27. Earnings per ShareYear ended 31 August 2020
Equity per share attributable to ownersof the Parent (Yen)Year ended 31 August 2021
9,368.83

Equity per share attributable to ownersof the Parent (Yen)

10,930.42

Basic earnings per share for the year (Yen)885.15

Basic earnings per share for the year (Yen)

1,663.12

Diluted earnings per share for the year (Yen)883.62

Diluted earnings per share for the year (Yen)

1,660.44(Note) The basis for calculation of basic earnings per share and diluted earnings per share for the year is as follows:Year ended
31 August 2020

Year ended
31 August 2021

90,357

169,847--

Profit attributable to common shareholders (Millions of yen)

90,357

169,847

Average number of common stock during the year (Shares)

102,081,609

102,125,851--

Increase in number of common stock (Shares)

177,082

164,744(share subscription rights)(177,082)(164,744)

Basic earnings per share for the year
Profit for the year attributable to owners of the Parent (Millions of yen)
Profit not attributable to common shareholders (Millions of yen)

Diluted earnings per share for the year
Adjustment to profit (Millions of yen)

－

131 －

28. Cash Flow Information
A. Liabilities of financing activities
Liabilities of financing activities are as follows:Year ended 31 August 2020
(Millions of yen)
Balances as
at
31 August2019

Adjustmentfor
adoption of
IFRS16

Variation without cash flow

Balances as
at 1
September
2019

Variationwithcash flow

Foreigncurrencytranslation
reserve

New lease
contracts

OthersBalances as
at
31 August
2020

Short-termborrowings

1,236

-

1,236

13,472445--

15,154Long-term
borrowings

4,258

-

4,258

(4,343)

84

-

-

-

Corporatebonds

469,183-

469,183

-

-

-

158

469,342

Finance leaseobligations

38,726(38,726)

-

-

-

-

-

-

Lease
liabilities-

428,631428,631(141,216)

2,806

177,451(1,493)

466,179

Total

513,405

389,904

903,309(132,087)

3,336

177,451(1,334)

950,675

Year ended 31 August 2021
(Millions of yen)
Variation without cash flow
Balances as at
1 September
2020

Variation withcash flow

Foreigncurrencytranslation
reserve

New lease
contracts

Balances as at
31 August
2021

OthersShort-term borrowings

15,154(3,556)

1,565

-

-

13,163

Corporate bonds

469,342(100,000)

-

-

128

369,471

Lease liabilities

466,179(148,248)

10,082

142,346(9,700)460,658

Total

950,675(251,805)

11,648142,346(9,571)

843,292(Note) 100,000 million yen in 2nd non-collateralized corporate bonds (interest rate: 0.291%; date of maturity: 18 December 2020)
have been redeemed.
B. Important non-cash transactions
Year ended 31 August 2020
The amount of increase or decrease in right-of-use assets is listed in "17. Leases."
Year ended 31 August 2021
The amount of increase or decrease in right-of-use assets is listed in "17. Leases."

－

132 －

C. Information on corporate bonds as at 31 August 2020 and 2021 is as follows:(Millions of yen)Company name

FAST RETAILING CO.,LTD.
FAST RETAILING CO.,

Date ofissuance

Name of bonds
2nd non-December2015

3rd non-LTD.
FAST RETAILING CO.,

4th noncollateralized18
December

corporate bonds

2015

FAST RETAILING CO.,LTD.
FAST RETAILING CO.,

5th noncollateralized
corporate bonds
6th noncollateralized
corporate bonds
7th non-LTD.

collateralized
corporate bonds

FAST RETAILING CO.,8th noncollateralizedLTD.

Date ofmaturity

99,989-0.291

December2020

49,957

49,976

0.491

December2022

18

69,9150.749

2025
79,9430.110

6 June2023

6 June2018

29,94329,9550.220

6 June2025

99,786

99,8130.405

39,85939,8670.880

469,342

369,471-

6 June2018-－

69,89518
December

79,910

2018

-

16

6 June2018

6 Junecorporate bonds
TotalInterest
rate (%)

18
December
2015

FAST RETAILING CO.,
LTD.

As at
31 August2021

18

collateralized
corporate bonds
collateralized
corporate bonds

LTD.

As at
31 August
2020

133 －

6 June2028
4 June2038-

29. Share-based Payments
The Group has a program for issuing share subscription rights as share-based compensation stock options for employees of theCompany and its subsidiaries as a means of recognizing their contribution to the Group’s profit. By linking the Company’s stock
price to the benefits received by personnel, this program aims to boost staff morale and motivation, improve Group performance,and enhance shareholder value by strengthening business development with a focus on shareholder return.
A. Details, scale, and changes in stock options(1) Description of stock options
1st Share subscription rights
A typeCategory and number of grantees

1st Share subscription rights
B typeEmployees of theCompany:

7

Employees of Groupsubsidiaries:

3

Employees of theCompany:
Employees of Groupsubsidiaries:

266

413

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 3,370 sharesmaximum 77,542 shares

Grant date

8 November 2010

8 November 2010

To serve continuously until the

To serve continuously until thevesting date (7 November 2013)
after the grant date (8 November

vesting date (7 December 2010)
after the grant date (8 November

2010)

2010)

From 8 November 2010 to

From 8 November 2010 to

7 November 2013

7 December 2010

Exercise period

From 8 November 2013 to
7 November 2020

From 8 December 2010 to
7 November 2020

Settlement

Equity settlement

Equity settlement

Vesting conditions

Eligible service period

2nd share subscription rights
A typeCategory and number of grantees

Employees of theCompany:
Employees of Groupsubsidiaries:

2nd share subscription rights
B type14

4Employees of theCompany:
Employees of Groupsubsidiaries:

139

584

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 13,894 sharesmaximum 51,422 shares

Grant date

15 November 201115 November 2011

To serve continuously until the

To serve continuously until thevesting date (14 November 2014)
after the grant date (15 November

vesting date (14 December 2011)
after the grant date (15 November

2011)

2011)

Eligible service period

From 15 November 2011 to
14 November 2014

From 15 November 2011 to
14 December 2011

Exercise period

From 15 November 2014 to
14 November 2021

From 15 December 2011 to
14 November 2021

Settlement

Equity settlement

Equity settlement

Vesting conditions

－

134 －

3rd share subscription rights
A typeEmployees of theCategory and number of grantees

Company:
Employees of Group

3rd share subscription rights
B type18

subsidiaries:

8

Employees of theCompany:
Employees of Groupsubsidiaries:

136

615

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 10,793 sharesmaximum 39,673 shares

Grant date

13 November 2012

13 November 2012

To serve continuously until thevesting date (12 November 2015)

To serve continuously until thevesting date (12 December 2012)

after the grant date (13 November
2012)

after the grant date (13 November
2012)

From 13 November 2012 to
12 November 2015

From 13 November 2012 to
12 December 2012

From 13 November 2015 to

From 13 December 2012 to

12 November 2022

12 November 2022

Equity settlement

Equity settlement

Vesting conditions

Eligible service period
Exercise period
Settlement

4th share subscription rights
A typeEmployees of theCategory and number of grantees

Company:
Employees of Groupsubsidiaries:

4th share subscription rights
B type19

11

Employees of theCompany:
Employees of Groupsubsidiaries:

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 7,564 sharesmaximum 29,803 shares

Grant date

3 December 2013

3 December 2013

Vesting conditions

Eligible service period
Exercise period
Settlement

To serve continuously until thevesting date (2 December 2016)
after the grant date (3 December
2013)

the grant date (3 December 2013)
From 3 December 2013 to
2 January 2014

From 3 December 2016 to

From 3 January 2014 to

2 December 2023

2 December 2023

Equity settlement

Equity settlement

135 －

706

To serve continuously until thevesting date (2 January 2014) after

From 3 December 2013 to
2 December 2016－180

5th share subscription rights
A typeEmployees of theCategory and number of grantees

Company:
Employees of Groupsubsidiaries:

5th share subscription rights
B type36

16

Employees of theCompany:
Employees of Groupsubsidiaries:

223

785

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 21,732 sharesmaximum 33,062 shares

Grant date

14 November 2014

14 November 2014

To serve continuously until thevesting date (13 November 2017)

To serve continuously until thevesting date (13 December 2014)

after the grant date (14 November
2014)

after the grant date (14 November
2014)

From 14 November 2014 to
13 November 2017

From 14 November 2014 to
13 December 2014

From 14 November 2017 to

From 14 December 2014 to

13 November 2024

13 November 2024

Equity settlement

Equity settlement

Vesting conditions

Eligible service period
Exercise period
Settlement

6th share subscription rights
A typeEmployees of theCategory and number of grantees

Company:
Employees of Groupsubsidiaries:

6th share subscription rights
B type15

19

Employees of theCompany:
Employees of Groupsubsidiaries:

274

921

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 2,847 sharesmaximum 25,389 shares

Grant date

13 November 2015

13 November 2015

To serve continuously until thevesting date (12 November 2018)

To serve continuously until thevesting date (12 December 2015)

after the grant date (13 November
2015)

after the grant date (13 November
2015)

From 13 November 2015 to
12 November 2018

From 13 November 2015 to
12 December 2015

From 13 November 2018 to

From 13 December 2015 to

12 November 2025

12 November 2025

Equity settlement

Equity settlement

Vesting conditions

Eligible service period
Exercise period
Settlement

－

136 －

7th share subscription rights
A typeEmployees of theCategory and number of grantees

Company:
Employees of Groupsubsidiaries:

7th share subscription rights
B type16

23

Employees of theCompany:
Employees of Groupsubsidiaries:

339

1,096

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 2,821 sharesmaximum 31,726 shares

Grant date

11 November 2016

11 November 2016

To serve continuously until thevesting date (10 November 2019)

To serve continuously until thevesting date (10 December 2016)

after the grant date (11 November
2016)

after the grant date (11 November
2016)

From 11 November 2016 to
10 November 2019

From 11 November 2016 to
10 December 2016

From 11 November 2019 to

From 11 December 2016 to

10 November 2026

10 November 2026

Equity settlement

Equity settlement

Vesting conditions

Eligible service period
Exercise period
Settlement

8th share subscription rights
A typeCategory and number of grantees

Employees of theCompany:
Employees of Groupsubsidiaries:

8th share subscription rights
B type19

27

Employees of theCompany:
Employees of Groupsubsidiaries:

395

1,152

Number of stock options by type of shares(Note)

Common stock:maximum 5,454 shares

Common stock:maximum 48,178 shares

Grant date

10 November 2017

10 November 2017

To serve continuously until thevesting date (9 November 2020)

To serve continuously until thevesting date (9 December 2017)

after the grant date (10 November
2017)

after the grant date (10 November
2017)

From 10 November 2017 to

From 10 November 2017 to

9 November 2020

9 December 2017

From 10 November 2020 to

From 10 December 2017 to

9 November 2027

9 November 2027

Equity settlement

Equity settlement

Vesting conditions

Eligible service period
Exercise period
Settlement

－

137 －

8th share subscription rights
C typeCategory and number of grantees

Employees of theCompany:

9th share subscription rights
A type29

Employees of theCompany:
Employees of Groupsubsidiaries:

17

32

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 5,929 sharesmaximum 4,057 shares

Grant date

10 November 2017

9 November 2018

To serve continuously until the

To serve continuously until thevesting date (9 November 2020)
after the grant date (10 November

vesting date (8 November 2021)
after the grant date (9 November

2017)

2018)

From 10 November 2017 to

From 9 November 2018 to

9 November 2020

8 November 2021

Exercise period

10 November 2020

From 9 November 2021 to
8 November 2028

Settlement

Equity settlement

Equity settlement

Vesting conditions

Eligible service period

－

138 －

9th share subscription rights
B typeEmployees of theCategory and number of grantees

Company:
Employees of Groupsubsidiaries:

9th share subscription rights
C type419

Employees of theCompany:

40

1,267

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 36,275 sharesmaximum 4,733 shares

Grant date

9 November 2018

9 November 2018

To serve continuously until thevesting date (8 December 2018)

To serve continuously until thevesting date (8 November 2021)

after the grant date (9 November
2018)

after the grant date (9 November
2018)

From 9 November 2018 to
8 December 2018

From 9 November 2018 to
8 November 2021

Vesting conditions

Eligible service period
Exercise period
Settlement

From 9 December 2018 to

9 November 2021

8 November 2028
Equity settlement

Equity settlement

10th share subscription rights
A typeEmployees of theCategory and number of grantees

Company:
Employees of Groupsubsidiaries:

10th share subscription rights
B type11

46

Employees of theCompany:
Employees of Groupsubsidiaries:

528

1,389

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 3,548 sharesmaximum 37,424 shares

Grant date

8 November 20198 November 2019

To serve continuously until thevesting date (7 November 2022)

To serve continuously until thevesting date (7 December 2019)

after the grant date (8 November
2019)

after the grant date (8 November
2019)

From 8 November 2019 to
7 November 2022

From 8 November 2019 to
7 December 2019

From 8 November 2022 to

From 8 December 2019 to

7 November 2029

7 November 2029

Equity settlement

Equity settlement

Vesting conditions

Eligible service period
Exercise period
Settlement

－

139 －

10th share subscription rights
C typeCategory and number of grantees

Employees of the

11th share subscription rights
A type40

Company:

Employees of theCompany:

18

Employees of Groupsubsidiaries:

47

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 3,666 sharesmaximum 2,175 shares

Grant date

8 November 201913 November 2020

To serve continuously until the

To serve continuously until thevesting date (7 November 2022)
after the grant date (8 November

vesting date (12 November 2023
after the grant date (13 November

2019)

2020)

From 8 November 2019 to

From 13 November 2020 to

7 November 2022

12 November 2023

Exercise period

8 November 2022

From 13 November 2023 to
12 November 2030

Settlement

Equity settlement

Equity settlement

Vesting conditions

Eligible service period

11th share subscription rights
B typeCategory and number of grantees

Employees of theCompany:
Employees of Groupsubsidiaries:

11th share subscription rights
C type694

Employees of the

41

Company:
1,435

Number of stock options by type of shares

Common stock:

Common stock:(Note)

maximum 22,306 sharesmaximum 3,777 shares

Grant date

13 November 2020

13 November 2020

To serve continuously until the

To serve continuously until thevesting date (12 December 2020)
after the grant date (13 November

vesting date (12 November 2023)
after the grant date (13 November

2020)

2020)

Eligible service period

From 13 November 2020 to
12 December 2020

From 13 November 2020 to
12 November 2023

Exercise period

From 13 December 2020 to
12 November 2030

13 November 2023

Settlement

Equity settlement

Equity settlement

Vesting conditions(Note) The number of stock options is equivalent to the number of shares.

Expenses recognized as share-based payments are as follows:(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

2,915

2,179

Expenses recognized
Share-based payments

－

140 －

(2) Scale of stock options program and changes
Outstanding balance of stock options are converted into equivalent number of shares.
(a) Number and weighted average exercise prices of stock options
Stock options
Year ended
31 August 2020

Year ended
31 August 2021

Number of shares(Shares)Number of shares(Shares)Non-vested
Non-vested at beginning of the year

25,51824,561

Granted44,63828,248Forfeited(1,196)(815)

Vested(44,399)(31,979)

24,561

20,015

Non-vested at end of the year

Year ended
31 August 2020

Year ended
31 August 2021

Number of shares(Shares)Number of shares(Shares)

VestedOutstanding at beginning of the year

143,233

148,450

Vested44,39931,979Exercised(38,891)(44,288)

Forfeited

(291)

(789)

148,450

135,352

Outstanding at end of the year

All stock options are granted with an exercise price of 1 yen per share.
(b) Stock price on exercise date
Stock options exercised during the year ended 31 August 2021 are as follows:
Number of shares(Shares)

Type
Stock options

Weighted-average stock priceon exercise date (Yen)
44,28882,971(c) Expected life of stock options
The weighted-average expected life of outstanding stock options as at 31 August 2021 was 5.52 years.
In addition, the weighted-average expected life of outstanding stock options as at 31 August 2020 was 5.80 years.

－

141 －

B. Methods of estimating fair value of stock options, etc.
The methods of estimating fair value of 11th share subscription rights A type, B type, and C type granted during the year
ended 31 August 2021, were as follows:(1) Valuation model: Black-Scholes model(2) The following table lists the inputs to the model used:
11th share subscription rights
A type11th share subscription rights
B typeFair value

77,559 yen

78,236 yen

Share price80,620 yen

80,620 yen

Exercise price

1 yen

1 yen

Stock price volatility (Note 1)

34%

35%

6.5 years

5.04 years

480 yen / share

480 yen / share(0.0835%)(0.09188%)

Expected life of options (Note 2)
Expected dividends (Note 3)
Risk-free interest rate (Note 4)

11th share subscription rights
C typeFair value

79,192 yen

Share price80,620 yen

Exercise price

1 yen

Stock price volatility (Note 1)

31%

Expected life of options (Note 2)

3 years

Expected dividends (Note 3)

480 yen / share

Risk-free interest rate (Note 4)(0.13%)

Notes: 1. Stock price volatility is computed based on the actual results of 6.5 years for A type (from June 2014 to November 2020),
5.04 years for B type (from December 2015 to November 2020), and 3.0 years for C type (from December 2017 toNovember 2020).
2. Expected life of options is estimated to be the reasonable period from the grant date until the exercise date.
3. Expected dividends are projected with reference to the historical actual dividends declared in prior years.
4. Risk-free interest rate refers to the yield of Japanese government bonds corresponding to the expected life of options.
5. The variables and assumptions used in computing the fair value of the share options are based on the Group’s best estimate.
The value of an option varies with different variables of certain subjective assumptions.

－

142 －

Also, the method of estimating fair value for the 10th share subscription rights A type, B type, and C type granted during theyear ended 31 August 2020 is as follows:(1) Valuation model: Black-Scholes model(2) The following table lists the inputs to the model used:
10th share subscription rights
A type10th share subscription rights
B typeFair value

66,058 yen

66,732 yen

Share price69,110 yen

69,110 yen

Exercise price

1 yen

1 yen

Stock price volatility (Note 1)

33%

34%

6.5 years

5.04 years

480 yen / share

480 yen / share(0.2105%)(0.21692%)

Expected life of options (Note 2)
Expected dividends (Note 3)
Risk-free interest rate (Note 4)

10th share subscription rights
C typeFair value

67,684 yen

Share price69,110 yen

Exercise price

1 yen

Stock price volatility (Note 1)

27%

Expected life of options (Note 2)

3 years

Expected dividends (Note 3)

480 yen / share

Risk-free interest rate (Note 4)(0.203%)

Notes: 1. Stock price volatility is computed based on the actual results of 6.5 years for A type (from June 2013 to November 2019),
5.04 years for B type (from December 2014 to November 2019), and 3.0 years for C type (from December 2016 toNovember 2019).
2. Expected life of options is estimated to be the reasonable period from the grant date until the exercise date.
3. Expected dividends are projected with reference to the historical actual dividends declared in prior years.
4. Risk-free interest rate refers to the yield of Japanese government bonds corresponding to the expected life of options.
5. The variables and assumptions used in computing the fair value of the share options are based on the Group’s best estimate.
The value of an option varies with different variables of certain subjective assumptions.

C. Estimation method of the number of share subscription rights which have already been vested
Because it is difficult to reasonably estimate the number of options that will expire in the future, the method reflecting actual
numbers of forfeiture is adopted.

－

143 －

30. Financial Instruments
A. Capital risk management
The Group engages in capital management to achieve continuous growth and maximize corporate value.
The ratio of the Group’s net interest-bearing borrowings to equity is as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Interest-bearing borrowings

484,496382,634

Lease liabilities

466,179

460,658

Cash and cash equivalents

1,093,531

1,177,736

Net interest-bearing borrowings(142,856)(334,443)

Equity996,079

1,162,298

Interest-bearing borrowings includes corporate bonds and borrowings. As at 31 August 2020 and 2021, the Group maintained aposition where the carrying amount of cash and cash equivalents exceeded the total amounts of interest-bearing borrowings andlease liabilities.
As at 31 August 2021, the Group is not subject to any externally imposed capital requirement.
B. Significant accounting policies
See Note “3. Significant Accounting Policies” for significant accounting policies regarding standards for recognizing financial
assets, financial liabilities, equity financial instruments, as well as the fundamentals of measurement and recognition of profit or
loss.

－

144 －

C. Categories of financial instruments(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Trade and other receivables

67,06950,546

Other current financial assets

49,89056,157

Other non-current financial assets

66,39966,113

1,370

1,008

1,619

209

23,77849,446

Trade and other payables

210,747

220,057

Other current financial liabilities

213,301

104,969

Current lease liabilities

114,652

117,083

Non-current financial liabilities

370,780

370,799

Non-current lease liabilities

351,526

343,574

69

280

5,899

3,256

Financial assets
Loans and receivables

Financial assets measured at fair value through othercomprehensive income / (loss)
Derivatives
Financial assets measured at fair value through profit or loss
Financial assets designated as hedging instruments
Financial liabilities
Financial liabilities at amortized cost

Derivatives
Financial liabilities measured at fair value throughprofit or loss
Financial liabilities designated as hedging instruments

No items in the above categories are included in discontinued operations or disposal groups held-for-sale. Also, there are no
financial assets or liabilities valued using the fair value option to measure fair value.
On the consolidated statement of financial position, available-for-sale investments are included under “non-current financial
Assets.”D. Financial risk management
In relation to cash management, the Group seeks to ensure effective utilization of Group funds through the Group’s CashManagement Service. The Group obtained credit facilities from financial institutions and issuance of bonds. Any temporary
surplus funds are invested mainly in fixed interest rate-bearing instruments with minimal credit risk.
The Group entered into foreign currency forward contracts to hedge risk arising from fluctuations in foreign currency exchange
rates and did not conduct any speculative trading in derivatives.

－

145 －

E. Market risk management
The Group conducts its business on a global scale, and is therefore exposed to the price fluctuation risk of currencies and equity
financial instruments.
(1) Foreign currency risk(a) Foreign currency risk management
The Group conducts its business on a global scale, and is exposed to foreign currency risk in relation to purchases and sales
transactions and financing denominated in currencies other than the local currencies of those countries in which the Group
operates its business.
In regard to forecast transactions denominated in foreign currencies, for foreign currency exchange fluctuation risk by
currency and on a monthly basis, the Group in principle hedges risk by using foreign currency forward contracts.
For imports, the Group endeavors to stabilize purchasing costs by concluding foreign currency forward contracts andstandardizing import exchange rates. If the yen should weaken significantly against the US dollar in the future and thissituation continued for an extended period, it could have a negative impact on the Group’s performance.
The Group enters into derivative transactions only with financial institutions evaluated as highly creditworthy by rating
agencies to mitigate the counterparty risk.
The Group’s notional amount of foreign currency forward contracts was 1,284,423 million yen as at 31 August 2021.
(b) Foreign currency sensitivity analysis
With respect to companies that use yen as the functional currency in each reporting period, below is an analysis of the
impact an 1% increase in the yen against the Euro (“EUR”) and the United States dollar (“USD”) would have on theGroup’s profit before income taxes and other comprehensive income (before tax effects).
However, this analysis assumes that over variable factors are constant. Furthermore, this does not include the effect ofconversion of financial instruments denominated the functional currencies, and revenue, expenses, assets, and liabilities ofoverseas sales entities into presentation currency.
Year ended
31 August 2020

Year ended
31 August 2021

USD

108.04106.96EUR

120.06128.01USD(3,853)(4,318)

EUR

(239)

(209)

USD

(10,316)(10,693)

EUR

(127)

(187)

Average exchange rate (Yen)

Impact on profit before income taxes (Millions of yen)

Impact on other comprehensive income (Millions of yen)

－

146 －

(c) Currency derivatives and hedges
The Group uses foreign currency forward contract transactions to hedge against the risk of future fluctuations in exchange
rates in regard to foreign currency transactions and applies hedge accounting to transactions that meet hedge requirements,
and did not conduct any speculative trading in derivatives.
Cash flow hedges
A cash flow hedge is a hedge for avoiding risk of volatility in future cash flows. The Company uses foreign currency
forward contracts to hedge cash flow fluctuations relating to forecast transactions.
The monetary value of ineffective hedges is immaterial.
The details of foreign currency forward contract are as follows:(i) Derivative transactions to which hedge accounting is not applied
Foreign currencies(Millions ofrespective currency)

Average exchange
31 August2020

Contract principal(Millions of yen)

Fair value(Millions of yen)

31 August2021

31 August2020

31 August2021

31 August2020

31 August2021

31 August2020

31 August2021

1,137.61

-

20

-

2,071

-

83

-

(KRW/$)(KRW/$)

0.00($/KRW)($/KRW)

24,663

-

2,151

-

44

-

0.85
(EUR/$)

0.84(EUR/$)

8

27

855

2,932

(19)

24

0.77
(£/$)

0.76
(£/$)

15

5

1,447

628

(38)

(25)

(sell GBP)
Buy USD(sell KRW)

1,124.35

1,147.18

154

43

15,463

4,725

830

69

(KRW/$)(KRW/$)

Buy USD(sell TWD)

29.41

27.86

21

18

2,249

2,033

7

(6)

(TWD/$)(TWD/$)(SGD/$)

1.35(SGD/$)

-

2

-

221

-

(1)

(THB/$)

31.12(THB/$)

-

1

-

166

-

6

7.84

-

7

-

789

-

(9)

-

-

8

-

927

-

(11)

Foreign currency forward contracts
Over 1 year
Buy USD(sell KRW)
Buy KRW(sell USD)
Within 1 year
Buy USD(sell EUR)
Buy USD

Buy USD(sell SGD)
Buy USD(sell THB)
Buy USD(sell HKD)

(HKD/$)(HKD/$)-

23,142.72(VND/$)(VND/$)

1.14($/EUR)

1.22($/EUR)

7

22

843

2,967

45

(88)

1.26
($/£)

1.42
($/£)

11

4

1,475

659

83

(17)

0.00
($/KRW)

188,516

50,620

16,249

4,800

519

(21)

(sell USD)

0.00($/KRW)

Buy HKD(sell USD)

0.13

-

57

-

779

-

1

-

($/HKD)($/HKD)

Buy USD(sell VND)
Buy EUR(sell USD)
Buy GBP(sell USD)
Buy KRW－

147 －(ii) Derivative transactions to which hedge accounting is applied
Foreign currencies
Average exchange rates(Millions ofrespective currency)
31 August2020

Contract principal(Millions of yen)

Fair value(Millions of yen)

31 August2021

31 August2020

31 August2021

31 August2020

31 August2021

31 August2020

31 August2021

105.09
(¥/$)

6,192

6,034

637,960

634,0947,945

21,481103

324

10,95834,579

(219)

(327)

49

110

5,208

12,2151(306)

Foreign currency forward contracts
Over 1 year
Buy USD(sell JPY)

103.02(¥/$)

Buy USD

0.85

0.82

(sell EUR)

(EUR/$)(EUR/$)

Buy USD(sell GBP)

0.75

0.73

(£/$)

(£/$)

Buy USD(sell KRW)

1,158.56(KRW/$)

1,116.47(KRW/$)

107

108

11,077

11,423

223

502

Buy USD

1.36(SGD/$)

4

0

425

22

(3)

0

(sell SGD)

1.37
(SGD/$)

Buy USD

30.00

32.46

11

5

1,134

551

43

0

(sell THB)

(THB/$)(THB/$)

Buy USD(sell MYR)

4.43

4.25

2

6

224

674

(10)

(2)

(MYR/$)(MYR/$)

Buy USD(sell AUD)

1.44
(AUD/$)

1.32(AUD/$)

34

24

3,853

2,617

(207)

103

Buy USD

1.25(CAD/$)

0

6

89

652

(4)

7

(sell CAD)

1.38
(CAD/$)

Buy USD

53.30

49.34

15

5

1,742

632

(116)

15

(sell PHP)

(PHP/$)(PHP/$)

Buy EUR(sell USD)

-

8.35

-

13

-

12,107-36($/EUR)($/EUR)－

148 －Average exchange rates

Foreign currencies(Millions ofrespective currency)

Contract principal(Millions of yen)

Fair value(Millions of yen)

31 August2020

31 August2021

31 August2020

31 August2021

31 August2020

31 August2021

31 August2020

31 August2021

Buy USD

102.26102.79

3,443

3,756

352,183

386,147

10,11525,643(sell JPY)

(¥/$)

(¥/$)

Buy USD(sell EUR)

0.84

0.84

209

224

22,09924,390

(132)

(17)

(EUR/$)(EUR/$)

0.77

0.74

86

96

9,422

10,815

(254)

(287)

Within 1 year

Buy USD(sell GBP)

(£/$)

(£/$)

Buy USD(sell KRW)

1,099.02(KRW/$)

1,146.97(KRW/$)

151

117

14,852

12,690

1,158

208

Buy USD

1.39(SGD/$)

1.34(SGD/$)

84

56

9,126

6,150

(152)

7

30.17
(THB/$)

30.93(THB/$)

88

49

9,030

5,142

278

244

37

48

4,103

5,324

(96)

44

70

89

7,974

9,843

(486)

0

57

88

5,551

10,363616(387)(sell SGD)
Buy USD(sell THB)
Buy USD

4.29

4.17

(sell MYR)

(MYR/$)(MYR/$)

Buy USD(sell AUD)

1.45

1.37

(AUD/$)(AUD/$)

Buy USD(sell RUB)

67.59

78.40

(RUB/$)(RUB/$)

Buy USD(sell CAD)

1.32
(CAD/$)

1.29(CAD/$)

36

52

3,885

5,926

(34)

(120)

Buy USD

14,660.80(IDR/$)

14,721.74(IDR/$)

41

65

4,401

7,377

8

(131)

50.23
(PHP/$)

69

57

7,883

6,375

(463)

(16)

(sell PHP)

52.03
(PHP/$)

Buy USD

75.71

-

2

-

230

-

(5)

-

(sell INR)

(INR/$)(INR/$)

Buy USD(sell HKD)

7.82

7.76

70

95

7,504

10,427(58)

21(HKD/$)(HKD/$)

Buy USD(sell CNY)

6.99

6.75

187

138

20,07915,833

(248)

(544)

(CNY/$)(CNY/$)

Buy EUR(sell USD)

1.18($/EUR)

2.30($/EUR)

20

24

2,529

6,070

30

16

Buy GBP

1.27
($/£)

1.38
($/£)

8

14

1,074

2,252

49

(7)

0.00
($/IDR)

0.00($/IDR)

444,01172,826

3,056

549

(94)

9

(sell USD)
Buy HKD(sell USD)

-

0.13

-

23

-

329

-

0

($/HKD)($/HKD)(sell IDR)
Buy USD(sell USD)
Buy IDR(2) Interest rate risk management
The Group’s interest-bearing borrowings are mainly bonds with fixed interest rates, and the Group maintains positions incash and cash equivalents that exceed the outstanding balance of its interest-bearing borrowings.
At present, the impact of interest payments on the Group is quite small. Consequently, the Group’s current level of interest
rate risk is minor, and the Group has not performed any interest rate sensitivity analysis.

－

149 －

(3) Price risk management in equity instruments
The Group is exposed to the risk of price volatility in equity financial instruments. The Group holds no equity financial
instruments for short-term trading purposes.
The Group makes regular periodic checks of the market value of the equity financial instruments it holds, as well as thefinancial health of the issuers.
F. Credit risk management
When the Group initiates ongoing transactions where receivables are generated on an ongoing basis, the finance department
manages the Group’s risk exposure by setting credit limits and credit periods, as needed.
Trade receivables encompass many customers spanning a wide range of industries and geographic regions. The Group conducts
regular credit checks of the companies it does business with, and when necessary takes appropriate protective measures, such as
requiring collateral.
The Group does not have excessively concentrated credit risk exposure to any single company or corporate group.
As for deposits and guarantees, the Group mitigates risk by conducting regular monitoring of the companies with which it does
business for early detection of any worsening of their financial health.
Financial assets and other credit risk exposure
The carrying amounts after adjustment for impairment shown in the consolidated financial statements represent the Group’s
maximum exposure to credit risk before consideration of collateral assets.
(1) Credit risk exposure
Time-frame analysis for trade receivables and other financial assets is as stated below.
Year ended 31 August 2020
(Millions of yen)
Items measured in an amount equivalent to the
expected credit losses for the entire period

Number of days elapsed
after due date

Before due date has elapsed
Within 90 days
Over 90 days but within
one yearOver one year
Term-end balance

Items recorded
in an amountequivalent to
12 months of
expected credit
lossesFinancialassetsfor which theallowancefor doubtful
accounts isalwaysmeasuredas an amountequivalent to
expected losses
for the whole
periodFinancialassetsfor which thecredit risk hassignificantly
increased sinceinitialrecognition

Creditimpaired
financial assets

Total

124,30259,01947-

183,368

481

474

-

-

956

156

25

2

-

184

23

150

69

-

244

124,965

59,669119-

184,754－

150 －Year ended 31 August 2021
(Millions of yen)
Items measured in an amount equivalent to the
expected credit losses for the entire period

Number of days elapsed
after due date

Before due date has elapsed
Within 90 days
Over 90 days but within
one yearOver one year
Term-end balance

Financialassetsfor which theallowancefor doubtful
accounts isalwaysmeasuredas an amountequivalent to
expected losses
for the whole
periodFinancialassetsfor which thecredit risk hassignificantly
increased sinceinitialrecognition

Creditimpaired
financial assets

127,637

44,543

40-

172,221

51

180

0

-

232

317

7

2

-

327

386

237

46

28

697

128,392

44,9698928

173,479

Items recorded
in an amountequivalent to
12 months of
expected credit
lossesTotal(2) Allowances for Doubtful Accounts
Changes in allowances for doubtful accounts for trade receivables and other financial assets are as stated below.
Year ended 31 August 2020
(Millions of yen)
Items measured in an amount equivalent to the
expected credit losses for the entire period

Changes in allowances for
doubtful accounts

Starting balance

Items recorded
in an amountequivalent to
12 months of
expected credit
lossesFinancialassetsfor which theallowancefor doubtful
accounts isalwaysmeasuredas an amountequivalent to
expected losses
for the whole
periodFinancialassetsfor which thecredit risk hassignificantly
increased sinceinitialrecognition

Creditimpaired
financial assets

Total

117

471

40

241

871

-

938

-

-

938

Balance after adjustment

117

1,409

40

241

1,809

Increase during period

35

224

5

-

265

Decrease during period(intended use)

(15)

(322)

-

(247)

(585)

(61)

(36)

-

-

(98)

Other changes

(11)

9

-

6

4

Term-end balance

64

1,284

46

-

1,395

Effect of adoption of IFRS 16

Decrease during period(reversals)

－

151 －

Year ended 31 August 2021
(Millions of yen)
Items measured in an amount equivalent to the
expected credit losses for the entire period

Changes in allowances for
doubtful accounts

Items recorded
in an amountequivalent to
12 months of
expected credit
lossesFinancialassetsfor which theallowancefor doubtful
accounts isalwaysmeasuredas an amountequivalent to
expected losses
for the whole
periodFinancialassetsfor which thecredit risk hassignificantly
increased sinceinitialrecognition

Creditimpaired
financial assets

Total

Starting balance

64

1,284

46

-

1,395

Increase during period

8

55

19

28

111

(0)

(699)

-

-

(699)

Decrease during period(reversals)

(28)

(106)

(46)

-

(181)

Other changes

15

22

-

-

37

Term-end balance

59

557

19

28

664

Decrease during period(intended use)

The Group continually monitors the credit standing of trading partners if there is a concern about recoverability,
including receivables for which the due date has changed.
Based on the monitoring of the credit standing, the recoverability of accounts receivable, etc., is examined and theallowance for doubtful accounts is set.
In relation to the Group’s global business expansion, there is little reliance on any specific trading partners and exposure
is dispersed, so the impact of any sequential credit risk due to the poor credit standing of any specific trading partner isminimal.
As a result, we have no exposure to excessively concentrated credit risk.

－

152 －

G. Liquidity risk management
The Group manages liquidity risk by formulating and revising its funding plans on a timely basis and maintains an appropriate
level of liquidity on hand.
The ultimate responsibility for management of liquidity risk lies with the CFO appointed by the Board of Directors. The financedepartment, under the direction of the CFO, performs the day-to-day aspects of liquidity risk management by maintaining
appropriate levels of surplus funds and bank loans, and by monitoring budgets and cash flows.
(Millions of yen)More than More than More than
2 years but 3 years but 4 years but
withinwithinwithin3 years
4 years
5 years

Carrying
amountContractual Less thancash flows
1 year1 to 2years

Over
5 years

Trade and other payables

210,747

210,747

210,747

-

-

-

-

-

Short-term borrowings

15,15415,15415,154

-

-

-

-

-

Corporate bonds

469,342470,000

100,000-

130,000-

30,000210,000

351,526

365,539-

85,37060,86549,84638,523130,932

114,652

115,222

115,222

-

-

-

-

-

98,15698,15698,156

-

-

-

-

-

5,968

5,968

2,763

1,348

1,757

99

-

-

1,265,548

1,280,788

542,044

86,718

192,62249,946

68,523340,932

Trade and other payables

220,057

220,057

220,057

-

-

-

-

-

Short-term borrowings

13,163

13,163

13,163

-

-

-

-

-

Corporate bonds

369,471370,000-

130,000-

30,00070,000140,000

Long-term finance leaseliabilities

343,574

360,474-

86,41761,48946,86228,000137,705

Short-term finance leaseliabilities

117,083

120,492

120,492

-

-

-

-

-

Deposits

91,80591,80591,805

-

-

-

-

-

3,536

3,536

2,493

553

489

-

-

-

1,158,693

1,179,530

448,013

216,971

61,97876,862

98,000277,705

As at 31 August 2020
Non-derivative financial
liabilities

Long-term finance leaseliabilities
Short-term finance leaseliabilities
Deposits
Derivative financial liabilities
Foreign currency forward
contracts
Total
As at 31 August 2021
Non-derivative financial
liabilities

Derivative financial liabilities
Foreign currency forward
contracts
Total(Note) Guaranteed obligations are not included in the above, as the probability of having to act on those guarantees is remote.

－

153 －

H. Fair value of financial instruments(Millions of yen)
As at 31 August 2020

As at 31 August 2021

Carrying
amounts

Fair value

Carrying
amounts

Fair value

63,63964,34164,50265,35863,63964,34164,50265,358469,342

470,938

369,471375,144469,342

470,938

369,471375,144

Financial assets
Security deposits / guarantees
Total
Financial liabilities
Corporate bonds
Total(Note) The above includes the outstanding balance of corporate bonds due within one year.
Notes concerning financial assets and financial liabilities for which fair value approximates book value have been omitted.
The fair value of security deposits / guarantees is calculated on the basis of the current value, applying the current market
interest rate.
The fair value of corporate bonds is calculated with reference to publicly available market prices.
The fair value measurements of Security deposits / guarantees and Corporate bonds are classified as level 2.

－

154 －

I. Fair value hierarchy of financial instruments
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fairvalue hierarchy described as follows, based on the lowest level input that is significant to the fair value measurement as awhole:
Level 1 - based on quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2 - based on valuation techniques for which the lowest level input that is significant to the fair value measurement isobservable, either directly or indirectly
Level 3 - based on valuation techniques for which the lowest level input that is significant to the fair value measurement isunobservable
When multiple inputs are used to measure fair value, the fair value level is determined based on the input with the lowest levelclassification in the overall fair value assessment.
The following tables illustrate the fair value measurement hierarchy of the Group’s financial instruments:(Millions of yen)
As at 31 August 2020

Level 1

Financial assets measured at fair value throughother comprehensive income
Financial assets measured at fair value throughAs at 31 August 2021

other comprehensive income
Financial assets measured at fair value throughprofit or loss
Financial assets and financial liabilities
designated as hedging instruments — Fair value
Net amount

Total

-

212

1,370

-

1,550

-

1,550

-

17,878-17,878

1,158

19,428212

20,799Level 1

Financial assets measured at fair value throughLevel 3

1,158

profit or loss
Financial assets and financial liabilities
designated as hedging instruments — Fair value
Net amount

Level 2

Level 2

Level 3

Total

808

-

199

1,008

-

(71)

-

(71)

-

46,190-46,190808

46,118

199

47,127For the valuation of Level 2 derivative financial instruments for which a market value is available, we use a valuation modelthat uses observable data on the measurement date using inputs such as interest rates, yield curves, currency rates, and volatility
in comparable instruments.
Financial instruments classified as Level 3 consist mainly of unlisted shares. The fair values of unlisted shares are measured by
the division responsible in the Group according to the Group’s accounting policy, etc., using the immediately preceding figuresavailable for each quarter.
There were no significant changes due to the purchase, sale, issuance and settlement of Level 3 financial instruments, and notransfers between Levels 1, 2 and 3.

－

155 －

31. Related Party Disclosures
Remuneration of key management personnel
Remuneration of the Group’s key management personnel is as below:(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

Short-term employee benefits

786

837

Share-based payments

13

31

799

869

Total

Transactions with officers and major shareholders (individuals only), etc. of the reporting entity submitting these consolidated
financial statements.
Year ended 31 August 2020 (from 1 September 2019 to 31 August 2020)
Name ofCompany,
etc., orpersonal
name

Type

Company
in which
officers
and close
relatives
hold amajorityof votingrightsLocation

TTY
Amsterdam,
Management
Netherlands
B.V.

CapitalStock or
Money
Invested(Millions ofyen)

71,826

Business
Content or
Occupation

Assetsholdings,
managing,
etc.

Percentage
of voting Relation withright, etc.
Associatedheld (being
Party
held)

5.2% aredirectly
held

Transaction
Details

Transaction
Amount(millions ofyen)Store renting

647

Rent of store
properties
by oursubsidiary

Item

Lease
liabilities

Term-end
Balance(millions of
yen)

6,797

Servesconcurrently
as an officer(Notes) 1. Of the above-mentioned amounts, any trade amounts do not include consumption taxes and the like.
2. Trading conditions and policy for determining trading conditions, etc.
Related party transactions were made on terms equivalent to those that prevail in arm’s length transactions.
3. Chairman of the Board of Directors and President Tadashi Yanai holds a majority of the voting rights.
Current consolidated accounting year (From 1 September 2020, through 31 August 2021)

Type

Company
in which
officers
and close
relatives
hold amajorityof votingrightsCompany
in which
officers
and close
relatives
hold amajorityof votingrightsName ofCompany,
etc., orpersonal
nameLocation

TTY
Amsterdam,
Management
Netherlands
B.V.

546
Broadway,
LLC

New York

CapitalStock or
Money
Invested(Millions ofyen)

71,826-

Business
Content or
Occupation

Assetsholdings,
managing,
etc.

Percentage
of voting Relation withright, etc.
Associatedheld (being
Party
held)

5.2% aredirectly
held

Transaction
Details

Transaction
Amount(millions of
yen)

Item

Term-end
Balance(millions ofyen)Store renting

428

Lease
liabilities

6,744

Store renting

109

Lease
liabilities

3,971

Rent of store
properties
by oursubsidiary
Servesconcurrently
as an officer
Rent of store
properties
by oursubsidiary

Assetsholdings,
managing,
etc.

Servesconcurrently
as an officer

－

156 －

(Notes) 1. Of the above-mentioned amounts, any trade amounts do not include consumption taxes and the like.
2. Trading conditions and policy for determining trading conditions, etc.
Related party transactions were made on terms equivalent to those that prevail in arm’s length transactions.
3. Chairman of the Board of Directors and President Tadashi Yanai holds a majority of the voting rights of both companies.
32. Major Subsidiaries
The Group’s major subsidiaries are as listed in “3. Corporate Profile 3. Subsidiaries and Associates.” The liquidation of J Brand
Inc., which was a major subsidiary at the end of the previous consolidated fiscal year, was completed in this current consolidated
fiscal year.
33. Commitments
The Group had the following commitments at each reporting date:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Commitment for the acquisition of property, plant and equipment

24,942

21,492

Commitment for acquisition of intangible assets

2,139

1,487

27,081

22,979Total

34. Contingent Liabilities
Year ended 31 August 2020
Not applicableYear ended 31 August 2021
Not applicable
35. Subsequent Events
Not applicable
E. Others
Quarterly information for the year ended 31 August 2021
(Cumulative period)First quarter

Second quarter

Third quarter

619,797

1,202,864

1,698,082

2,132,992

107,164

171,482245,654

265,872

Quarterly net income (Millions of yen)

70,381

105,868

151,351

169,847

Earnings per share (Yen)

689.291,036.76

1,482.08

1,663.12

First quarter

Second quarter

Third quarter

Fourth quarter

689.29347.49445.33181.08

Revenue (Millions of yen)
Quarterly income before income taxes andnon-controlling interests (Millions of yen)

(Accounting period)
Quarterly earnings / (losses) per share (Yen)

－

157 －

Fiscal year

10. Financial statements(1) Balance Sheet(Millions of yen)
As at 31 August 2020

As at 31 August 2021

ASSETS
Current assets
Cash and deposits
Operating accounts receivable

569,322589,833※1 30,174※1 40,936

Securities
Short-term loans receivable from subsidiaries and associates

145,965
58,624146,449
38,039Accounts receivable from subsidiaries and associates
Others

18,863
5,677

24,7785,772(1)(4,747)

828,625

841,061

21,590※3 (8,661)

30,762※3 (10,608)

12,92820,154

Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net
Structures
Accumulated depreciation
Structures, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Land
Leased assets
Accumulated depreciation
Leased assets, net
Construction in progress

369

375

※3 (261)※3 (273)

108

102

2,646
※3 (1,698)

3,204※3 (2,030)

948

1,174

1,123
1,801

1,123
1,306

※3 (922)※3 (1,086)

878

219

3,116

5

19,104

22,77945,95947,174

Software in progress
Others

3,153
14

3,106
10

Total intangible assets

49,12650,291

Investments and other assets
Investment securities

1,318

969

Shares of subsidiaries and associates
Investments in capital of subsidiaries and associates

131,482
9,251

140,848
9,251

Long-term loans receivable from subsidiaries and associates
Leases and guarantee deposits

18,4146,300

14,7796,202

Deferred tax assets
Lease receivables

3,460
-

4,847
15,587

OthersAllowance for doubtful accounts

407(4,134)46(6,265)

Total investments and other assets

166,500

186,265

Total property, plant and equipment
Intangible assets
SoftwareTotal non-current assets
Total assets

－

158 －

234,731259,336

1,063,356

1,100,398

(Millions of yen)
As at 31 August 2020

As at 31 August 2021

LIABILITIESCurrent liabilities
Current portion of corporate bonds

100,000-

10,290
2,005

6,335
5,463

Deposits received
Provision for bonuses※1 22,919※1 21,156

2,621

3,193

Income taxes payable
Others

8,597
1,217

598
2,548

Total current liabilities

147,652

39,295

Non-current liabilities
Corporate bonds payable

370,000

370,000

588
3,385

15,680
3,395

394
466

435
341

1,913

3,679

376,749

393,532

524,402432,828

Accounts payable
Accrued expenses

Lease obligations
Guarantee deposits received
Provision for loss on guarantees
Provision for loss on business of subsidiaries and associates
OthersTotal non-current liabilities
Total liabilities
NET ASSETS
Shareholders’ equity
Capital stock

10,273

10,273

Capital surplus
Legal capital surplus

4,578

4,578

Other capital surplus

7,786

9,587

Total capital surplus

12,364

14,166818

818

185,100
338,851

185,100
465,122524,769

651,040

Retained earnings
Legal retained earnings
Other retained earnings
General reserve
Retained earnings brought forward
Total retained earnings
Treasury stock(15,129)(14,973)

Total shareholders’ equity

532,279

660,507

(566)

(338)

Valuation and translation adjustments
Valuation differences on available-for-sale securities
Total valuation and translation adjustments
Share subscription rights
Total net assets
Total liabilities and net assets

－

159 －

(566)

(338)

7,241

7,400

538,954

667,569

1,063,356

1,100,398

(2) Statement of Income(Millions of yen)
Year ended
31 August 2020
Operating revenue
Management income from operating companies

Year ended
31 August 2021

※1 64,815※1 79,345※1 91,540※1 199,259

156,356

278,605

10,79811,360Bonuses
Allowance for bonuses

1,658
1,988

1,584
2,141

Rental expenses
Depreciation

8,379
14,92010,34818,754

Outsourcing expenses
Others26,837
16,45527,481
15,490※1 81,039※1 87,162

Operating profit / (loss)

75,316

191,442

Non-operating income
Interest income

4,592

1,054

92
93

16
17,590

Dividends income from subsidiaries and associates
Total operating revenue
Operating expenses
Selling, general and administrative expenses
Salaries

Total operating expenses

Interest on securities
Foreign exchange gains
Others

196

115

4,975

18,776

2,022
57

1,951
46

※1 2,079※1 1,997

78,211

208,221

-

739

43

125

43

864

※2 3166,688※2 4
19,432

Provision of allowance for doubtful accounts for subsidiaries andassociates

3,083

6,876

Loss on valuation of investment securities
Impairment losses

1,713
13

330
-

Transfer pricing adjustment
Others※1 1,065

40

Total extraordinary losses

13,15926,68465,096

182,401

Total non-operating income
Non-operating expenses
Interest expenses
OthersTotal non-operating expenses
Ordinary profit / (loss)
Extraordinary income
Gain on sale of investment securities
Reversal of provision for loss on business of subsidiaries andassociates
Total extraordinary income
Extraordinary losses
Losses on retirement of non-current assets
Loss on valuation of shares of subsidiaries and associates

278

Income/(loss) before income taxes
Income taxes － current

3,066

8,540

Income taxes － deferred(392)(1,424)

Total income taxes

2,674

7,115

Profit / (loss)

62,422

175,286－160 －(3) Statement of changes in net asset
Year ended 31 August 2020
(Millions of yen)
Shareholders’ equity
Capital surplus

Retained earnings
Other retained earnings

Capital
stock

Legal
capitalsurplus

OthercapitalsurplusTotal
capitalsurplusLegalretainedearnings

10,273

4,578

6,335

10,914

Dividends---

Net income--

Acquisition of treasury stock-

Disposal of treasury stock
Net changes of items other thanthose in shareholders’ equity

Balance at the beginning of year

Total
retainedearnings

Generalreserve

Retainedearnings
brought
forward818

185,100

325,423

511,341---(48,994)(48,994)

-

-

-

-

62,42262,422

-

-

-

-

-

-

-

-

-

1,450

1,450

-

-

-

-

-

-

-

-

-

-

-

-

-

-

1,450

1,450

-

-

13,427

13,427

10,273

4,578

7,786

12,364818

185,100

338,851524,769

Changes during the year

Net changes during the year
Balance at the end of year

Valuation and translation
adjustments

Shareholders’ equity

Share
subscription
rightsTreasury stock

Total
shareholders’equityValuationdifferences onavailable-forsale
securities

Total valuationand translation
adjustments(15,271)517,258(1,533)(1,533)

5,981

521,706

Dividends-(48,994)---(48,994)

Net income-

62,422---62,422Acquisition of treasury stock

(5)

(5)

-

-

-

(5)

Disposal of treasury stock

148

1,598

-

-

-

1,598

-

-

967

967

1,260

2,228

Net changes during the year142

15,020

967

967

1,260

17,248

Balance at the end of year

(15,129)532,279

(566)

(566)

7,241

538,954

Balance at the beginning of year

Total net assets

Changes during the year

Net changes of items other thanthose in shareholders’ equity

－

161 －

Year ended 31 August 2021
(Millions of yen)
Shareholders’ equity
Capital surplus

Retained earnings
Other retained earnings

Capital
stock

Legal
capitalsurplus

OthercapitalsurplusTotal
capitalsurplusLegalretainedearnings

10,273

4,578

7,786

12,364

Dividends---

Net income--

Acquisition of treasury stock-

Disposal of treasury stock
Net changes of items other thanthose in shareholders’ equity

Balance at the beginning of year

Total
retainedearnings

Generalreserve

Retainedearnings
brought
forward818

185,100

338,851524,769---(49,015)(49,015)

-

-

-

-

175,286

175,286

-

-

-

-

-

-

-

-

-

1,801

1,801

-

-

-

-

-

-

-

-

-

-

-

-

-

-

1,801

1,801

-

-

126,270

126,270

10,273

4,578

9,587

14,166818

185,100

465,122651,040

Changes during the year

Net changes during the year
Balance at the end of year

Valuation and translation
adjustments

Shareholders’ equity

Share
subscription
rightsTreasury stock

Total
shareholders’equityValuationdifferences onavailable-forsale
securities

Total valuationand translation
adjustments(15,129)532,279

(566)

(566)

7,241

538,954

Dividends-(49,015)---(49,015)

Net income-

175,286---

175,286

Acquisition of treasury stock

(12)

(12)

-

-

-

(12)

Disposal of treasury stock

168

1,970

-

-

-

1,970

-

-

227

227

159

386

Net changes during the year155

128,228

227

227

159

128,614

Balance at the end of year

(14,973)

660,507

(338)

(338)

7,400

667,569

Balance at the beginning of year

Total net assets

Changes during the year

Net changes of items other thanthose in shareholders’ equity

－

162 －

(4) Notes(Significant accounting policies)
1. Valuation methods for securities(a) Investments in subsidiaries and associates:
The Company’s investments in subsidiaries and associates are stated at cost. The cost of securities sold is determined by theaverage method.
(b) Available-for-sale securities:(i) Listed securities:
Listed securities are stated at fair value, with fair value gains and losses, net of applicable taxes, reported as “unrealized
gains/(losses) on available-for-sale securities,” a separate component of net assets. The cost of securities sold is determinedbased on the moving-average cost method.
(ii) Unlisted securities:
Unlisted securities are stated at cost, which is determined by the average method.
2. Depreciation method for non-current assets(a) Property, plant and equipment (other than leased assets)
Depreciation of property, plant and equipment is calculated using the straight-line method. The principal ranges of estimateduseful lives are as follows:
Buildings and structures

5-10 years

Tools, furniture, and fixtures
5 years(b) Intangible assets (other than leased assets)
Amortization of intangible assets is calculated using the straight-line method. The principal range of estimated useful life is asfollows:
Software for internal use(c) Leased assets

5 years

Assets held under capitalized finance leases are depreciated using the straight-line method over the lease terms at zero residual
value.
3. Accounting for deferred assets
Issuance expenses of corporate bonds
Issuance expenses of corporate bonds are expensed as incurred.
4. Provision basis for allowances(a) Allowance for doubtful accounts
Provision for potential bad debts, loan loss ratios are recorded for general accounts receivable. Specified doubtful accounts
receivable are reviewed individually to determine their recoverability, and an estimate for the non-recoverable portion isrecorded.
(b) Provisions for bonuses
Bonuses to employees are accrued on the balance sheet date.
(c) Provisions for loss on guarantees
To prepare for losses related to loan guarantees for associated companies, the Company considers the financial position of theguarantee, and records an anticipated loss figure.
(d) Allowances for Affiliated Company Operating Losses
In order to prepare for losses pertaining to affiliated company operations, we take the financial position of our affiliatedcompanies into consideration and list the estimate losses that may be incurred.
5. Other significant matters for the preparation basis of non-consolidated financial statements(1) Accounting for consumption tax
Transactions subject to consumption taxes are recorded at amounts exclusive of consumption taxes.
(2) Application of consolidated taxation system
The consolidated taxation system is applied for the Company.

－

163 －

(Changes in presentation)
Balance sheet“Lease liabilities” that was included in “Others” under non-current liabilities in the previous fiscal year is separately presented
from the current fiscal year due to its increased materiality. As a result, “Others” under “Non-current liabilities” amounted 2,502
million yen for previous fiscal year was reclassified to “Lease obligations” amounted 588 Million yen and “Others” amounted
1,913 Million yen on the Balance sheet.
(Notes to balance sheet)
1. Breakdown of assets and liabilities related to subsidiaries and associates which were not separately presented are as follows:(Millions of yen)
As at 31 August 2020
Trade accounts receivable
Deposits received

30,131
22,525As at 31 August 2021
40,926
20,777

2. Contingent liabilities(Millions of yen)
As at 31 August 2020

As at 31 August 2021

Guarantees for office and retail store leases

40,651

22,219

Guarantees on loans payable to financial institutions

6,558

5,089

3. Accumulated depreciation includes accumulated impairment losses.

－

164 －

(Notes to statement of income)1. Transactions related to the subsidiaries and associates are as follows:(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

Ordinary revenue:
Management income from operating companies
Dividends income from subsidiaries and associates
Ordinary expense
Non-operating expenses (including Extraordinary

62,97091,54077,352
199,259

2,712

2,161

1,081
83
losses)(Note) Non-operating expenses (including Extraordinary losses) for the previous fiscal year include 1,065 million yen of transfer
pricing adjustments relating to the past periods between the Company and its U.S. subsidiaries based on Advance Pricing
Agreement in relation to transfer pricing taxation.
2. The breakdown of losses on retirement of non-current assets is as follows:(Millions of yen)
Year ended
31 August 2020

Year ended
31 August 2021

Buildings
Other property, plant and equipment

69
0

1

Software
Other intangible assets

200
45

1
1

(Marketable securities)
As at 31 August 2020
The fair values of the shares of subsidiaries and associates (subsidiaries 117,215 million yen and associates 14,266 million yen
on the balance sheet) are not described as they do not have a market price and the fair value is extremely difficult to determine.
As at 31 August 2021
The fair values of the shares of subsidiaries and associates (subsidiaries 122,881 million yen and associates 17,966 million yen
on the balance sheet) are not described as they do not have a market price and the fair value is extremely difficult to determine.
(Note) The impairment of the shares of subsidiaries and associates without market price is determined by comparing the costwith the substantial value calculated based on the net assets per share of respective subsidiaries and associates. An impairment
loss is recognized if the substantial value is less than 50% of the cost.

－

165 －

(Deferred taxes)
1. The breakdown of causes of deferred tax assets and deferred tax liabilities is as follows:(Millions of yen)
As at
31 August 2020

As at
31 August 2021

Deferred tax assets:
Provisions for bonuses
Depreciation

799
890

982
957

Loss on shares of subsidiaries and associates
Impairment losses

52,766282

58,668259

Allowance for doubtful accounts
Valuation differences on available-for-sale securities

1,266
365

3,372
221

Unused tax losses carried forward
Software

4,337
2,872

3,543
3,632

Others

4,087

5,531

Subtotal
Valuation allowance pertaining to tax loss carried forward

67,666(4,337)

77,168(3,543)

Valuation allowance pertaining to total of future deductible
temporary difference(57,544)(66,010)

Valuation allowance subtotal(61,881)(69,554)

5,785

7,614

(1,893)(431)(1,893)(873)

Total deferred tax liabilities(2,325)(2,766)

Net deferred tax liabilities

3,460

4,847

Total deferred tax assets
Deferred tax liabilities:
Temporary differences on shares of subsidiaries
Others(Note) Deferred tax assets and deferred tax liabilities are recorded based on the provisions of the tax law before revision as allowed in
the provisions of the “Treatment of Tax Effect Accounting for the Transition from the Consolidated Taxation System to theGroup Tax Sharing System” (ASBJ PITF No. 39, 31 March, 2020).
2. The differences between the effective tax rate after applying tax effect and the statutory income tax rate are as follows:(Percentage)
As at
31 August 2020

As at
31 August 2021

Statutory income tax rate

30.6%

30.6%

(adjustments)
Non-taxable dividend income(41.2)(33.0)

Increase/(decrease) in valuation allowance
Foreign withholding tax

5.8
8.8

4.3
2.1

Others

0.1

(0.1)

4.1

3.9

Effective tax rates after applying tax effect accounting(Business Combination)
Not applicable.
(Notes on Significant Subsequent Events)
Not applicable.

－

166 －

(5) Supplementary schedule
Details of fixed asset

Types of assets

Balances as at
1 September
2020

Increase(Millions of yen)
Accumulated
depreciation or
Depreciation, Balances as atamortizationamortization
31 Augustas at 31during the year
2021
August2021

Decrease

Property, plant and equipment
Buildings

12,928

9,457

27

2,204

20,154

10,608Structures

108

5

-

12

102

273

948

562

-

335

1,174

2,030

1,123

-

-

-

1,123

34

878

0

344

315

219

1,086

3,116

5,051

8,162

-

5

-

19,104

15,078

8,533

2,869

22,77914,033

Software45,95917,100-15,88447,174-

Software in progress

3,153

17,052

17,100

-

3,106

-

14

-

3

0

10

-

49,12634,152

17,103

15,88550,291-Tools, furniture, andequipment
Land
Leased assets
Construction in progress
Total property, plantand equipment
Intangible assets

OthersTotal intangible assets(Notes) 1. The main factors listed as increase during the year are as follows:
Types of assets

Amount (Millions of yen)Contents

Software17,100Construction cost for new system

Software in progress

17,052

Construction cost for new system

2. The main factors listed as decrease during the year are as follows:
Types of assets

Amount (Millions of yen)

Software in progress

17,100－167 －Contents
Construction cost for new systems (transferred tosoftware as the new system was launched)Details of provisions(Millions of yen)
Categories

Balance as at
1 September
2020

Allowance for doubtful accounts (current)
Allowance for doubtful accounts(non-current)
Provision for bonuses
Provision for loss on guarantees
Allowances for Affiliated Company Operating
LossesIncrease

Balance as at
31 August2021

Decrease

1

4,747

1

4,747

4,134

5,300

3,169

6,265

2,621

3,193

2,621

3,193

394

40

-

435

466

16

142

341

(Note) The increase in the Allowance for doubtful accounts for the current fiscal year is mainly for affiliated companies.
(6) Main details of assets and liabilities
Omitted because the consolidated financial statements are prepared.
(7) Others
Not applicable.

－

168 －

INDEPENDENT AUDITOR’S REPORTTo the Board of Directors of FAST RETAILING CO., LTD.:

OpinionWe have audited the consolidated financial statements of FAST RETAILING CO., LTD. (the “Company”) and its subsidiaries (the“Group”), which comprise the consolidated statement of financial position as at 31 August 2021, consolidated statement of profit orloss, consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash
flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting
policies.
In our opinion, the accompanying consolidated financial statements give a true and fair view of the consolidated financial position of
the Group as at 31 August 2021, and of its consolidated financial performance and its consolidated cash flows for the year then endedin accordance with International Financial Reporting Standards (“IFRSs”).

Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (“ISAs”). Our responsibilities under those standards
are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We
are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics forProfessional Accountants (“IESBA Code”) together with the ethical requirements that are relevant to our audit of the consolidated
financial statements in Japan, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the
IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated
financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

－

169 －

Valuation of inventories at the lower of cost or net realizable value
Key Audit Matter Description

How the Key Audit Matter Was Addressed in the Audit

As disclosed in Note 10 to the consolidated financial
statements, the Group’s total inventories as at 31 August 2021

Our audit procedures related to this key audit matter included
the following, among others:

were comprised of JPY374,595 million related to the UNIQLO
Japan segment, the UNIQLO International segment and the GU• Evaluation of the cost measurement techniques andsegment, in the aggregate, representing 14.9% of the Group’s
total assets. In addition, the amount of write-down of

inventory valuation approaches established by management,
including compliance with IFRSs.

inventories to net realizable value was JPY13,038 million forthese segments.

• Assessment of the design and operating effectiveness of

The sales pattern for inventories starts with establishing an
initial price, and then subsequently adjusting the price based on

relevant controls in place to address the accuracy andcompleteness of inputs for selling price and cost of

the season, weather and customer tastes and demand.
Inventories are valued at the lower of cost or net realizable

inventories.

value. Selling price, a component of net realizable value, isfrequently adjusted in response to fast-changing market• Involvement of our professionals with expertise in
information technology (“IT experts”) to evaluate theconditions, economic conditions and fashion trends. The
adjusted selling price is reflected and maintained in an IT

accuracy and completeness of inventory valuation reports by
testing the system interface controls, the report logic andsystem.
Given the nature of the Group’s businesses, changes to

input parameters, as well as general IT controls over the IT
system, including testing of user access controls, change

inventory, such as adjustments to selling prices, are frequently
made to large volumes of inventory at a Stock Keeping Units

management controls and IT operations controls.

(“SKUs”) level. Inventory management is therefore highly
dependent on the IT systems. In addition, the accuracy of the• Evaluation of the determination of net realizable value, thejudgment regarding whether a write-down is required andinventory valuation reports is also dependent upon the IT
system. As such, due to the potential impact it may have on thethe amount of write-down of inventories to net realizablevalue calculated within the inventory valuation report on aaccounting for the write-down of inventories to net realizablevalue, there are increased risks around the appropriateness ofrepresentative sample basis.

the system configurations (e.g., calculation formula, report
logic, parameters, etc.), in addition to the overall maintenanceof the IT system.
We identified this matter as a key audit matter given that thevalue of inventories is material and the valuation of inventories
is highly IT system dependent.

－

170 －

Assessment of impairment indicators on store assets and assumptions used in business plan under COVID-19 pandemic
Key Audit Matter Description

How the Key Audit Matter Was Addressed in the Audit

As disclosed in Note 15 to the consolidated financial
statements, the Group had store assets attributable to

Our audit procedures related to this key audit matter included
the following, among others:

UNIQLO Japan, UNIQLO International and the GU segment
amounting to JPY129,814 million, JPY205,036 million and• Evaluation of management’s assessment of Impairment

JPY31,599 million, respectively, in the aggregate representing
14.5% of the Group’s total assets as at 31 August 2021. In

Indicators, identification of CGUs and allocation method of
relevant headquarter costs to each CGU used byaddition, as disclosed in Note 6 and 15 to the consolidated
financial statements, the Group’s impairment losses

management, including compliance with IFRSs.

attributable to store assets were JPY15,723 million for theyear ended 31 August 2021.

• Involvement of our IT experts to evaluate the accuracy andcompleteness of the impairment indicators identification

Each segment operated 780, 1,502 and 439 stores as at 31

reports by testing source data of store performance results
along with the report logic to allocate headquarter costs,

August 2021, respectively, and the performance results ofeach store are maintained in an IT system. In principle, eachreport logic used to identify impairment indicators, andinput parameters, as well as the general IT controls over thestore is considered as an individual cash-generating unit(“CGU”). Management uses the performance results of stores

IT system, including testing of user access controls, change
management controls and IT operations controls.

(IT system-generated reports) as a key input when assessing
whether there is any indication that store assets may be• Examination of the Impairment Indicators identification

impaired (“Impairment Indicators”). As such, due to thepotential impact it may have on the assessment of thereport for the completeness of stores for proper inclusion.

Impairment Indicators, there are increased risks around theappropriateness of the system configurations (e.g., report• Assessment of the design and operating effectiveness of therelevant controls in place to develop business plans of each

logic, parameters, etc.), in addition to the overall maintenanceof the IT system.

store.

In particular, stores were temporarily closed and the number• Evaluation of the reasonableness of assumptions used, inparticular those relating to business plans of stores byof customer visits declined as people refrained from going out
in response to the COVID-19 pandemic, which continuously

performing inquiries with management, evaluating thehistorical accuracy of the management’s estimates andworsened performance results of certain stores. As a result,
there are potential risks around the existence of material

comparing those assumptions with market forecasts andobservable external information.

impairment losses. In addition, there are risks that theassessments of the Impairment Indicator and the measurement• Involvement of our valuation experts to assess the discountor impairment losses may be misstated due to increased
uncertainties on the recovery from COVID-19 pandemic inrate used in management’s impairment assessment.

particular, with regards to business plans of each store used inmanagement’s assessment.

• Evaluation of the adequacy of disclosures relating to theuncertainties of COVID-19 impact under Note to the

We identified this matter as a key audit matter given that theconsolidated financial statements 2. (E) Use of Estimatesand Judgments.

value of store assets is material, the creation of information
used in assessment of the impairment indicators is highly IT
system dependent, there is the increased possibility that the
impairment losses may be misstated due to COVID-19 andthere is the increased inherent uncertainty in business plans ofstores used in management’s estimates and judgements.

－

171 －

Other Information
Management is responsible for the other information. The other information comprises the information included in the annual report,
but does not include the consolidated financial statements and our auditor’s report thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express any form ofassurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doingso, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge
obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there
is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Statutory Auditors and the Board of Statutory Auditors for the Consolidated
Financial Statements
Management is responsible for the preparation of the consolidated financial statements that gives a true and fair view in accordancewith IFRSs, and for such internal control as management determines is necessary to enable the preparation of consolidated financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going
concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.
Statutory Auditors and the Board of Statutory Auditors are responsible for overseeing the Group’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free frommaterial misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in theaggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated
financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout theaudit. We also:• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis
for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence
obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability
to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’sreport to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion.
Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, andwhether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair
－ 172 －

presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Groupto express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance ofthe group audit. We remain solely responsible for our audit opinion.
We communicate with Statutory Auditors and the Board of Statutory Auditors regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide Statutory Auditors and the Board of Statutory Auditors with a statement that we have complied with relevant ethicalrequirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, related safeguards.
From the matters communicated with Statutory Auditors and the Board of Statutory Auditors, we determine those matters that were ofmost significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequencesof doing so would reasonably be expected to outweigh the public interest benefits of such communication.
The engagement partners on the audit resulting in this independent auditor’s report are Koichi Okubo and Hirofumi Otani.
Deloitte Touche Tohmatsu LLC
Tokyo, Japan
26 November 2021

－

173 －

(TRANSLATION)
INDEPENDENT AUDITOR’s REPORT
26 November 2021
To the Board of Directors of
FAST RETAILING CO., LTD. :Deloitte Touche Tohmatsu LLC
Tokyo office
Designated Engagement Partner,
Certified Public Accountant:
Koichi

Okubo

Designated Engagement Partner,
Certified Public Accountant:
Hirofumi

Otani

OpinionPursuant to the first paragraph of Article 193-2 of the Financial Instruments and Exchange Act, we have audited the nonconsolidated
financial statements of FAST RETAILING CO., LTD. (the "Company") included in the Financial Section, namely, the nonconsolidatedbalance sheet as at 31 August 2021, and the nonconsolidated statement of income, and nonconsolidated statement of changes in net
asset for the 60th fiscal year from 1 September 2020 to 31 August 2021, and a summary of significant accounting policies and otherexplanatory information, and the supplementary schedules.
In our opinion, the accompanying nonconsolidated financial statements present fairly, in all material respects, the financial position of
the Company as at 31 August 2021, and its financial performance for the year then ended in accordance with accounting principles
generally accepted in Japan.

Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibilities under those standards
are further described in the Auditor's Responsibilities for the Audit of the Nonconsolidated Financial Statements section of our report.
We are independent of the Company in accordance with the provisions of the Code of Professional Ethics in Japan, and we havefulfilled our other ethical responsibilities as auditors. We believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.

－

174 －

Key Audit Matters
A key audit matter is a matter that, in our professional judgment, was of most significance in our audit of the nonconsolidated financial
statements of the current period. The matter was addressed in the context of our audit of the nonconsolidated financial statements as awhole, and in forming our opinion thereon, and we do not provide a separate opinion on the matter.
Valuation of the shares of subsidiaries and associates
Key Audit Matter Description

How the Key Audit Matter Was Addressed in the Audit

The Fast Retailing group consists of 130 consolidated
subsidiaries and 3 associates accounted for using the equity

Our audit procedures related to this key audit matter included
the following, among others:

method.
The shares of subsidiaries and associates were 140,848• Assessment of the design and operating effectiveness of themillion, represented 12.7% of the Company’s total assets on
the balance sheet as at 31 August 2021.

relevant controls over the investments in subsidiaries andaffiliates to address the appropriateness of the substantial value

The shares of subsidiaries and associates do not have a market

calculated by management in accordance with the internal
policies, including review and approval. In addition, theprice and the valuation method is described in "Notes(Marketable securities)".

assessment of accuracy and completeness of the financial
information of significant subsidiaries used in the controls.

The impairment of the shares of subsidiaries and associates• Valuation of the reliability regarding the financial information

without market price is determined by comparing the costwith the substantial value calculated based on the net assetsof significant subsidiaries used as a basis of calculating the net
assets per share, by examining the audit procedures and audit

per share of respective subsidiaries and associates. An
impairment loss is recognized if the substantial value is lessresults of respective subsidiaries performed by their auditors.

than 50% of the cost.

• Examination of the appropriateness of management's valuationof the shares of subsidiaries and associates by comparing the

We identified this matter as a key audit matter given that thevalue of the shares of subsidiaries and associates without

cost with the substantial value of respective subsidiaries andassociates.

market price is material on the balance sheet.

Responsibilities of Management and Statutory Auditors and the Board of Statutory Auditors for the
Nonconsolidated Financial Statements
Management is responsible for the preparation and fair presentation of the nonconsolidated financial statements in accordance withaccounting principles generally accepted in Japan, and for such internal control as management determines is necessary to enable thepreparation of nonconsolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the nonconsolidated financial statements, management is responsible for assessing the Company's ability to continue as agoing concern, disclosing, as applicable, matters related to going concern in accordance with accounting principles generally acceptedin Japan.
Statutory Auditors and the Board of Statutory Auditors are responsible for overseeing the Directors' execution of duties relating to thedesign and operating effectiveness of the controls over the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the Nonconsolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the nonconsolidated financial statements as a whole are free frommaterial misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these nonconsolidated financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we exercise professional judgment and maintainprofessional skepticism throughout the audit. We also:

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• Identify and assess the risks of material misstatement of the nonconsolidated financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks. The procedures selected depend on the auditor's judgment. In
addition, we obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
• Obtain, when performing risk assessment procedures, an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the Company's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by management.
• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence
obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's
ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditor's report to the related disclosures in the nonconsolidated financial statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events
or conditions may cause the Company to cease to continue as a going concern.
• Evaluate whether the overall presentation and disclosures of the nonconsolidated financial statements are in accordance withaccounting principles generally accepted in Japan, as well as the overall presentation, structure and content of the nonconsolidated
financial statements, including the disclosures, and whether the nonconsolidated financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
We communicate with Statutory Auditors and the Board of Statutory Auditors regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide Statutory Auditors and the Board of Statutory Auditors with a statement that we have complied with relevant ethicalrequirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, related safeguards.

Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Company which is required to be disclosed pursuant to
the provisions of the Certified Public Accountants Act of Japan.
Notes to the Readers of Independent Auditor's Report
This is an English translation of the independent auditor's report as required by the Financial Instruments and Exchange Act of Japanfor the conveniences of the reader.

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Internal Control Report
1. Basic framework of internal control in connection with financial reporting
Chairman, President and CEO Tadashi Yanai and Chief Financial Officer Takeshi Okazaki hold responsibility for the preparationand management of internal controls in connection with financial reporting for the Company, its consolidated subsidiaries andassociates (hereinafter, the “Group”). The preparation and management of internal controls in connection with financial reportingare conducted in accordance with the basic framework of internal controls described in the “On the Setting of the Standards andPractice Standards for Management Assessment and Audit concerning Internal Control Over Financial Reporting - Council
Opinions”, published by the Business Accounting Council.
The basic elements of our internal controls are organically interconnected, and function as a single whole. Our aim is to achieve
their purposes within a reasonable range. For this reason, these internal controls on financial reporting may not completely preventor discover all misstatements in the financial reports.

2. Scope of evaluation, book-close dates, and evaluation procedures
The internal control evaluation of our financial reports was made on 31 August 2021, which was the last day of the fiscal year
under review. This evaluation was made using generally accepted internal control evaluation standards for financial reports.
This evaluation was started with an evaluation of internal controls that have a significant influence on our consolidated financial
reports as a whole (company-wide internal controls). The operational processes to be evaluated were selected on the basis of thisevaluation. In the evaluation of these operational processes, the selected operational processes were analyzed, and the key points ofinternal controls that might have a significant influence on the credibility of financial reports were categorized. Then, the status of
preparation and operation was evaluated in terms of these key points of internal controls to determine the effectiveness of theinternal controls.
The scope of the evaluation of the internal controls on financial reporting is of great importance, both fiscally and qualitatively, forthe credibility of the Group’s financial reports. The methods and procedures employed are:Based on the principle that the operational procedures for the entire Company’s internal controls, accounts, and financial reports
should best be evaluated from a company-wide perspective, these evaluations are performed for the Group as a whole. However,
because some consolidated subsidiaries are very small, both fiscally and qualitatively, they are not included within the scope of theevaluation.
Regarding operational procedures, based on the results of the company-wide evaluation of internal controls, and as an indicator ofsales (adjusted to exclude intra-group sales) for each of our businesses in the fiscal year under review, those businesses that makeup roughly two-thirds of consolidated sales in the fiscal year under review are designated “important businesses. ” The selected
important businesses are evaluated in terms of broad indicators such as sales, accounts receivable, inventories and other operational
procedures. Next, the impact on the Group’s financial reports is calculated. Those operational procedures that are of particularimportance are added to the evaluation process.

3. Results of evaluation
Based on the evaluation results discussed above, it was determined that the Group’s internal controls on financial reports wereeffective as at the end of the fiscal year under review.

4. Additional items
None

5. Special items
None

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Confirmation Note
1. The Company’s Chairman, President and CEO Tadashi Yanai and Chief Financial Officer Takeshi Okazaki have reviewed thecontents of the financial reports for the Company’s 60th fiscal year (1 September 2020 – 31 August 2021), and confirm they aretrue, based on the Financial Instruments and Exchange Law.
2. Special items
None

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