FAST RETAILING CO., LTD.
迅銷有限公司First Quarterly Report 2016/17
2016.9.1–2016.11.30
Stock Code: 6288

Contents
Corporate Profile

2

Financial Highlights

3Management Discussion and Analysis

5

Information about the Reporting Entity

9

Financial Section

15

Interim Condensed Consolidated Statement of
Financial Position

16

Interim Condensed Consolidated Statement ofProfit or Loss and Interim Condensed Consolidated
Statement of Comprehensive Income

17Interim Condensed Consolidated Statement of
Changes in Equity

19

Interim Condensed Consolidated Statement of Cash Flows21

Notes to the Interim Condensed Consolidated
Financial Statements

23

Others29

Report on Review of Interim Condensed Consolidated
Financial Statements

30

Corporate Profile
Board of Directors
Executive Director

Principal Place of Business in Japan
Midtown Tower 9-7-1
Akasaka Minato-ku
Tokyo 107-6231
Japan

Mr. Tadashi Yanai (Chairman of the Board, President andChief Executive Officer)

Non-Executive Directors
Principal Place of Business in Hong Kong

Mr. Toru Murayama (External Director)
Mr. Takashi Nawa (External Director)

702–706, 7th Floor, Miramar Tower,
No. 132 Nathan Road
Tsim Sha Tsui
KowloonHong Kong

Independent Non-Executive Directors
Mr. Toru Hambayashi (External Director)
Mr. Nobumichi Hattori (External Director)
Mr. Masaaki Shintaku (External Director)

HDR Registrar and HDR Transfer Office
Statutory Auditors

Computershare Hong Kong Investor Services Limited
Shops 1712–1716, 17th Floor
Hopewell Centre
183 Queen’s Road East
WanchaiHong Kong

Mr. Akira Tanaka (Kansayaku) (Standing Statutory Auditor)
Mr. Masaaki Shinjo (Kansayaku) (Standing Statutory Auditor)
Mr. Takaharu Yasumoto (Shagai Kansayaku)(External Statutory Auditor)
Mr. Akira Watanabe (Shagai Kansayaku)(External Statutory Auditor)
Ms. Keiko Kaneko (Shagai Kansayaku)(External Statutory Auditor)

Stock CodeHong Kong: 6288
Japan: 9983

Joint Company Secretaries
Website Address

Japan: Mr. Mitsuru Ohki
Hong Kong: Ms. Choy Yee Man

http://www.fastretailing.com

Auditors
Ernst & Young ShinNihon LLC

Principal Banks
Sumitomo Mitsui Banking Corporation
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Mizuho Bank, Ltd.
The Hong Kong and Shanghai Banking Corporation Limited

Registered Office and Headquarters
717-1 Sayama
Yamaguchi City
Yamaguchi 754-0894
Japan

—2—

Financial Highlights
Financial Summary

TermFirst Quarterof
55th YearFirst Quarterof
56th Year

55th Year

Accounting period

Three months
ended
30 November
2015

Three months
ended
30 November
2016

Year ended
31 August
2016

Revenue (Millions of yen)

520,303528,847

1,786,473

Operating profit (Millions of yen)

75,921

88,591

127,292

Profit before income taxes (Millions of yen)

77,666104,204

90,237

Profit attributable to owners of the parent (Millions of yen)

48,02469,69548,052Comprehensive income/(loss) attributable to ownersof the parent (Millions of yen)

45,012

151,581(139,372)

Equity attributable to owners of the parent (Millions of yen)

779,368

710,441

574,501

1,264,584

1,410,933

1,238,119

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

471.07683.51471.31

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

470.48682.60470.69

61.6

50.4

46.4

Total assets (Millions of yen)

Ratio of equity attributable to owners of
the parent to total assets (%)
Net cash from operating activities (Millions of yen)

58,501

99,88698,755

Net cash used in investing activities (Millions of yen)

(7,178)(15,049)(245,939)

Net cash from/(used in) financing activities (Millions of yen)

(21,478)(19,627)

201,428

Cash and cash equivalents at end of the period (year)(Millions of yen)

387,537

465,691

385,431(Notes)1. The Company has prepared interim condensed consolidated financial statements, and therefore has not included
information regarding changes in key management indices for the submitting company.
2. Revenue does not include consumption taxes, etc.
3. The financial figures are quoted from interim condensed consolidated financial statements or consolidated
financial statements prepared in accordance with International Financial Reporting Standards (“IFRS”).

—3—

Business Description
There were no significant changes in the nature of business engaged in by the Group (the Company and its subsidiaries) during
the three months ended 30 November 2016.
Important changes concerning subsidiaries are as follows:
Not applicable.

—4—Management Discussion and Analysis
Business Review
1. Business and Operational Risks
No new business-related risks have arisen during the three months ended 30 November 2016.
There have been no important changes concerning business-related risks as stated in the annual report for the preceding
consolidated fiscal year.

2.

Significant Contract in Business Operation
None.

3.

Financial Analysis(1)

Results of Operations
The Fast Retailing Group reported a rise in both consolidated revenue and consolidated operating profit in the firstquarter of fiscal 2017, or the three months from 1 September to 30 November 2016. Consolidated revenue reached¥528.8 billion (+1.6% year-on-year), while consolidated operating profit totaled ¥88.5 billion (+16.7% year-on-year). While
the gross profit margin held steady year-on-year, the selling, general and administrative expense ratio improved by 1.8
points as we continued the Group-wide cost-cutting drive initiated in fiscal 2016. We recorded a foreign exchange gain of¥15.6 billion under finance income as the November month-end yen spot exchange rate is lower than the August monthend rate, boosting the carrying amount of our long-term foreign-currency denominated assets in terms of yen. As a result,
Fast Retailing consolidated profit rose considerably in the first quarter, with profit before income taxes increased to¥104.2 billion (+34.2% year-on-year), and profit attributable to owners of the parent expanded to ¥69.6 billion (+45.1%
year-on-year). Breaking the first-quarter performance down into the three individual business segments: UNIQLO Japan
reported increases in both revenue and operating profit, UNIQLO International recorded a fall in revenue but a rise inoperating profit, and Global Brands generated a rise in revenue but a fall in operating profit.
The Group’s medium-term vision is to become the world’s number one apparel digital retailer. To this aim, we arefocusing our efforts on expanding UNIQLO International’s operations and our low-priced GU casual fashion brand. We
continue to increase UNIQLO store numbers in each country where we operate, opening global flagship stores and largeformat stores in major cities around the world to help consolidate UNIQLO’s position as a key global brand. In addition,
we are also expanding our GU operation, which has grown into a second pillar brand for the Group alongside UNIQLO, by
opening more GU stores within Japan and accelerating the brand’s development and store numbers in overseas markets.
Another medium-term goal is to revolutionize our entire supply chain, spanningall procedures from planning to design,
raw materials procurement, manufacturing and retail into a new supply chain system that can fully satisfy the needsof today’s digital era. The customer-centric, information-driven supply chain is designed to support a comprehensive
new digital retailing business model for the Fast Retailing Group. In February 2017, all UNIQLO product-related andcommercial functions will be moved to our central Ariake headquarters to help build a swift, concurrent product- andinformation-creation system.
UNIQLO Japan
UNIQLO Japan generated rises in both revenue and operating profit in the first quarter of fiscal 2017, with revenue
totaling ¥238.8 billion (+3.4% year-on-year) and operating profit totaling ¥45.6 billion (+1.8% year-on-year). Same-store
including online sales increased 2.5% year-on-year. The total number of UNIQLO Japan stores declined by a net of 6 stores
year-on-year to 800 (excluding 41 franchise stores) at the end of November 2016. Of this total, three stores shifted fromdirectly operated stores to employee franchise stores.
Looking at the quarter in more detail, same-store sales declined in September and October due to unseasonal warm
weather that dampened demand for Fall Winter items. However, once temperatures dropped in November, same-store
sales picked up. The UNIQLO anniversary sale proved strong, so did sales of core products such as cashmere sweaters,
HEATTECH innerwear, and outerwear. Customer visits showed signs of recovery, rising year-on-year in the first quarter
partly on the back of our decision to continue the new attractive, readily recognizable price strategy introduced infiscal 2016. Firm control over discounting helped generate a 0.3 point improvement in the gross profit margin year-onyear. However, the selling, general and administrative expense ratio rose by 0.2 point year-on-year. While continued
cost-cutting efforts helped reduce business costs such as advertising and promotion, outsourcing and business trips,
distribution costs increased in relation to the transformation of our logistics systems.
—5—

UNIQLO International
UNIQLO International reported a fall in revenue to ¥196.5 billion (-0.2% year-on-year) but a strong rise in operating profit
to ¥30.1 billion (+44.6% year-on-year) in the first quarter of fiscal 2017. The fall in revenue was due largely to the effectof the stronger yen compared to the previous year, which pushed yen-based sales down by an average 16%. However
in terms of local currencies, sales rose across all of UNIQLO international’s operations. On the profit side, the segment’s
operating profit margin increased 4.7 points in the first quarter, thanks to an improvement in the gross profit margin,
and a successful cost-cutting drive which helped reduce the selling, general and administrative expense ratio. Profit
contributions from UNIQLO Greater China, UNIQLO Southeast Asia and Oceania were especially strong. Meanwhile, an
improvement in the gross profit margin at UNIQLO USA helped reduce operating losses at that operation. UNIQLO’s firsttwo stores in Canada, opened in September 2016, got off to a great start by attaining higher-than-expected sales. Fifteen
years after the first UNIQLO store outside Japan was opened in fall 2001, the UNIQLO International network surpassed themark of 1,000 stores, finally settling at 1,009 stores (+145 stores year-on-year) at the end of November 2016.
Global Brands
Global Brands’ revenue expanded to ¥92.7 billion (+1.1% year-on-year), but operating profit declined to ¥9.5 billion(-22.7% year-on-year).
Our low-priced GU casual fashion brand generated a rise in revenue but a fall in operating profit after unseasonal warm
weather in September stifled early sales of Fall ranges. While sales of trendy items such as coatigans and MA-1 blouson
jackets picked up strongly from October onwards, GU same-store sales only expanded marginally over the first quarter as
a whole. GU’s operating profit declined in the first quarter after lower-than-expected sales resulted in greater discountingof Fall inventory, and a year-on-year contraction in the gross profit margin. Though advertising and other expenses
were reduced as part of our cost-cutting drive, personnel and distribution costs rose, pushed the selling, general andadministrative expense ratio higher.
At other global brands, our France-based Princesse tam.tam label and our US-based J Brand premium denim label
continued to generate a loss, while fashion brands Theory and Comptoir des Cotonniers recorded steady operating profit.
Corporate Social Responsibility (“CSR”) and Environmental Protection“Fulfilling our social responsibility,” “contributing to society,” and “solving social issues and creating new value” are thebasic policies under which the Group conducts its CSR activities, and we are engaging in both global and local activities.
As an initiative to improve working conditions in our supply chain, we have been monitoring the working conditionsat our suppliers’ factories. In addition, we joined the Fair Labor Association (FLA), which is an international non-profit
organization that works to protect the rights of factory workers and with their assistance, we revised the code of conduct(CoC) for our production partners with the assistance of FLA. This enables us to further promote improvements in working
conditions and build a sustainable supply chain.
Since 2011, we have engaged in assisting refugees through a global partnership with the United Nations HighCommissioner for Refugees (UNHCR). In November 2015, we hosted a joint press conference with UNHCR, where we
made announcements such as donating a total of 10 million dollars in the coming 3 years, expanding employment ofrefugees, and providing aid in the form of emergency clothing. In October 2016, we decided to donate 1 million dollars of
our total funds of 10 million dollars to humanitarian aid efforts in South Sudan, which is particularly at risk.
In our “All-Product Recycling Initiative,” we deliver clothing collected at Uniqlo and GU stores to refugees and displaced
persons, and in November 2016, employees at our head office visited Myanmar to donate approximately 60 thousand
items of clothing. On this occasion, the recipients were internally displaced persons living in Kachin State and RakhineState. Apart from the Burmese population, there are numerous minorities living in Myanmar leads to internal conflict inregions around the country. This forces many internally displaced persons into harsh circumstances. We will continue toaid refugees and displaced persons in this manner through our “All-Product Recycling Initiative.”

—6—

(2)

Financial Positions
Total assets as at 30 November 2016 were ¥1,410.9 billion, which was an increase of ¥172.8 billion relative to the end of
the preceding consolidated fiscal year. The principal factors were an increase of ¥80.2 billion in cash and cash equivalents,
an increase of ¥65.2 billion in trade and other receivables, an increase of ¥22.7 billion in other current financial assets andan increased ¥22.5 billion in derivative financial assets.
Total liabilities as at 30 November 2016 were ¥672.0 billion, which was an increase of ¥31.6 billion relative to the endof the preceding consolidated fiscal year. The principal factors were a decrease of ¥71.4 billion in derivative financial
liabilities, an increase of ¥67.5 billion in trade and other payables, an increase of ¥19.4 billion in income taxes payable andan increase of ¥16.7 billion in other current liabilities.
Total net assets as at 30 November 2016 were ¥738.8 billion, which was an increase of ¥141.1 billion relative to the endof the preceding consolidated fiscal year. The principal factor was an increase of ¥52.8 billion in retained earnings and anincrease of ¥81.8 billion in other components of equity.

(3)

Cash Flows Information
Cash and cash equivalents as at 30 November 2016 had increased by ¥78.1 billion from the three months ended 30
November 2015, to ¥465.6 billion.
Net cash from operating activities for the three months ended 30 November 2016 was ¥99.8 billion, which was anincrease of ¥41.3 billion (+70.7 % year-on-year) from the three months ended 30 November 2015. The principal factors
were ¥104.2 billion in profit before income taxes (an increase of ¥26.5 billion from the three months ended 30 November2015), foreign exchange gains amounted to ¥15.6 billion (an increase of ¥13.9 billion from the three months ended 30
November 2015) and ¥7.1 billion in income taxes paid (a decrease of ¥26.9 billion from the three months ended 30
November 2015).
Net cash used in investing activities for the three months ended 30 November 2016 was ¥15.0 billion, which was anincrease of ¥7.8 billion (+109.7 % year-on-year) from the three months ended 30 November 2015. The principal factors
were decrease of ¥2.0 billion in bank deposits with maturity over 3 months (an increase of ¥8.1 billion from the threemonths ended 30 November 2015) and ¥8.7 billion for purchases of property, plant and equipment (a decrease of ¥2.4
billion from the three months ended 30 November 2015).
Net cash used in financing activities for the three months ended 30 November 2016 was ¥19.6 billion, which was adecrease of ¥1.8 billion (-8.6 % year-on-year) from the three months ended 30 November 2015. The principal factor was¥16.7 billion for cash dividends paid (a decrease of ¥1.0 billion from the three months ended 30 November 2015) and ¥1.2
billion for net decrease in short-term loans payable (a decrease of ¥1.3 billion from the three months ended 30 November2015).

—7—(4)Operational and Financial Assignment
There have been no important changes during the three months ended 30 November 2016 concerning issues that must be
addressed by the Group.

(5)

Research and Development
Not applicable.

(6)

Important Facilities
The following are the important facilities that were newly completed during the three months ended 30 November 2016.
<Subsidiaries in Japan>
Not applicable.
<Overseas Subsidiaries>
Company name

Type of facility

Name of business

Location

Completion date

UNIQLO CANADA INC.

UNIQLOInternational Stores

UNIQLO Toronto
Eaton Centre

Toronto, Ontario,
CanadaSeptember 2016

UNIQLO CANADA INC.

UNIQLOInternational Stores

UNIQLO Yorkdale
Shopping Centre

Toronto, Ontario,
CanadaOctober 2016

UNIQLO SINGAPORE PTE. LTD

UNIQLOInternational Stores

Orchard Central

Singapore

September 2016—8—

Information about the Reporting Entity
1. Stock Information(1) Number of Shares(i)

Total number of shares
Type

Total number of authorised shares (shares)

Common stock

300,000,000
Total

300,000,000(Note) There are no provisions for preemptive rights under the Companies Act of Japan, which would oblige the Company tooffer new shares on a pro rata basis to existing shareholders.
(ii)

Shares Issued

Type

As at 30 November 2016

Number of shares issued
as of submission date
(Shares)(As at 13 January 2017)

Name of financial
instrument exchangeof listing, or authorised
financial instruments
firms association

Details

100 sharesas one unit—

Common stock

106,073,656

106,073,656

First section of the Tokyo
Stock Exchange andthe Main board of
The Stock Exchange ofHong Kong Limited (Note)

Total

106,073,656

106,073,656—(Note) Hong Kong Depositary Receipts are listed on the Main Board of The Stock Exchange of Hong Kong Limited.

(2)

Share Subscription Rights
The Company has instituted a stock option program that grants rights to acquire new shares pursuant to the Companies
Act of Japan. Share subscription rights issued in the three months ended 30 November 2016 are as follows:(i)

7th Share subscription rights A type

Resolution date

13 October 2016

Number of stock options (Shares)

2,821

Number of share subscription rights for treasury stock(Shares)—

Type of shares to be issued upon exercise of sharesubscription rights

Common Stock

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

2,821

Amount to be paid upon exercise of share subscription rights
(Yen)

1

Exercise period of share subscription rights

From 11 November 2019
To 10 November 2026

Fair value on the grant date and amount of paid-in capitalper share upon exercise of share subscription rights (Yen)

Issue price:
Paid-in capital:

Exercise conditions of share subscription rights

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

Matters pertaining to transfer of share subscription rights

Any acquisition of share subscription rights by transfer shallrequire an authorizing resolution from the Boardof Directors.

Matters pertaining to substitute payments

34,684
17,342—Matters pertaining to issuing of share subscription rights
in conjunction with reorganization(Notes)—9—

(Notes) Upon any reorganization of the Company (collectively referred to as “Reorganization”) consisting of merger (limited tocases 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 exchangeor transfer of shares (in each 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 sharesubscription rights for shares of the resulting company as prescribed in subparagraphs (a)-(e) of 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 newshare subscription rights; provided, however, that terms and conditions stipulating that the Company Resulting From
Reorganization shall issue share subscription rights that prescribe the matters stated below shall be included in any
absorption merger agreement, new merger agreement, absorption-type company split agreement, incorporation-typecompany 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 andnumber of 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 theamount obtained by multiplying the exercise price after reorganization prescribed below by the number of sharesof the Company Resulting From Reorganization underlying the share subscription rights that have been finalized asstated in No. 3. above. The exercise price after Reorganization shall be 1 yen per share of the Company Resulting
From Reorganization that can be issued upon exercise of each share subscription rights 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 as prescribed above or the day on which a Reorganization takes effect through the final day of theperiod during which share subscription 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 the share 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
Directors of 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.

— 10 —

(ii)

7th Share subscription rights B type

Resolution date

13 October 2016

Number of stock options (Shares)

31,726

Number of share subscription rights for treasury stock(Shares)—

Type of shares to be issued upon exercise of sharesubscription rights

Common Stock

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

31,726

Amount to be paid upon exercise of share subscription rights
(Yen)

1

Exercise period of share subscription rights

From 11 December 2016
To 10 November 2026

Fair value on the grant date and amount of paid-in capitalper share upon exercise of share subscription rights (Yen)

Issue price:
Paid-in capital:

Exercise conditions of share subscription rights

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

Matters pertaining to transfer of share subscription rights

Any acquisition of share subscription rights by transfer shallrequire an authorizing resolution from the Boardof Directors.

Matters pertaining to substitute payments

35,16817,584—

Matters pertaining to issuing of share subscription rights
in conjunction with reorganization(Notes)(Notes) Upon any reorganization of the Company (collectively referred to as “Reorganization”) consisting of merger (limited tocases 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 exchangeor transfer of shares (in each 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 sharesubscription rights for shares of the resulting company as prescribed in subparagraphs (a)-(e) of 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 newshare subscription rights; provided, however, that terms and conditions stipulating that the Company Resulting From
Reorganization shall issue share subscription rights that prescribe the matters stated below shall be included in any
absorption merger agreement, new merger agreement, absorption-type company split agreement, incorporation-typecompany 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 andnumber of 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 theamount obtained by multiplying the exercise price after reorganization prescribed below by the number of sharesof the Company Resulting From Reorganization underlying the share subscription rights that have been finalized asstated in No. 3. above. The exercise price after Reorganization shall be 1 yen per share of the Company Resulting
From Reorganization that can be issued upon exercise of each share subscription rights 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 as prescribed above or the day on which a Reorganization takes effect through the final day of theperiod during which share subscription rights can be exercised as prescribed above.

— 11 —

6.

7.

8.
9.

(iii)

Matters pertaining to the increase of capital and capital reserve resulting from the issuance of shares upon
exercise of the share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.
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
Directors of the Company Resulting From Reorganization.
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.
Conditions for exercise of share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.

7th Share subscription rights C type

Resolution date

13 October 2016

Number of stock options (Shares)

5,205

Number of share subscription rights for treasury stock(Shares)—

Type of shares to be issued upon exercise of sharesubscription rights

Common Stock

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

5,205

Amount to be paid upon exercise of share subscription rights
(Yen)

1

Exercise period of share subscription rights

11 November 2019

Fair value on the grant date and amount of paid-in capitalper share upon exercise of share subscription rights (Yen)

Issue price:
Paid-in capital:

Exercise conditions of share subscription rights

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

Matters pertaining to transfer of share subscription rights

Any acquisition of share subscription rights by transfer shallrequire an authorizing resolution from the Boardof Directors.

Matters pertaining to substitute payments

35,855
17,928—Matters pertaining to issuing of share subscription rights
in conjunction with reorganization(Notes)(Notes) Upon any reorganization of the Company (collectively referred to as “Reorganization”) consisting of merger (limited tocases 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 exchangeor transfer of shares (in each 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 sharesubscription rights for shares of the resulting company as prescribed in subparagraphs (a)-(e) of 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 newshare subscription rights; provided, however, that terms and conditions stipulating that the Company Resulting From
Reorganization shall issue share subscription rights that prescribe the matters stated below shall be included in any
absorption merger agreement, new merger agreement, absorption-type company split agreement, incorporation-typecompany 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 andnumber of shares underlying the above-mentioned share subscription rights.

— 12 —

4.

5.

6.

7.

8.
9.

(3)

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 theamount obtained by multiplying the exercise price after reorganization prescribed below by the number of sharesof the Company Resulting From Reorganization underlying the share subscription rights that have been finalized asstated in No. 3. above. The exercise price after Reorganization shall be 1 yen per share of the Company Resulting
From Reorganization that can be issued upon exercise of each share subscription rights that is issued.
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 prescribedabove or the day on which a Reorganization takes effect.
Matters pertaining to the increase of capital and capital reserve resulting from the issuance of shares upon
exercise of the share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.
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
Directors of the Company Resulting From Reorganization.
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.
Conditions for exercise of share subscription rights:
To be determined in order to align with the conditions applicable to the subject share subscription rights.

Exercise of convertible bonds with conditional permission for adjustment of exercise priceNot applicable.

(4)

Content of Rights Plan
Not applicable.

(5)

Change in Total Number of Shares Issued, Capital Stock, Etc.

Date

Increase/
Balance of total
decrease of
number of
total number ofshares issued
shares issued(Shares)(Shares)

1 September 2016 to
30 November 2016—

Increase/decrease ofcapital stock(Millionsof yen)Balance ofcapital stock(Millionsof yen)—10,273106,073,656

Increase/
Balance of
decrease ofcapital reserve
capital reserve(Millions(Millionsof yen)of yen)—4,578(Note) There was no increase or decrease in the total number of shares issued, capital stock or capital reserve during the threemonths ended 30 November 2016.

(6)

Principal Shareholders
There are no items to state, as the accounting period under review is the first quarter accounting period.

(7)

Voting Rights
Concerning “Voting Rights” as at the end of the first quarterly accounting period ended 30 November 2016, it has notbeen possible to confirm and state the details entered in the register of shareholders. Therefore, the stated details are
based on the register of shareholders as of the immediately preceding record date (31 August 2016).

— 13 —

(i)Shares issued
As at 30 November 2016
Number of shares(Shares)Number of voting
rights (Number)

Remarks

Non-voting shares

—

—

—

Shares subject to restrictions on voting rights(treasury stock)

—

—

—

Shares subject to restrictions on voting rights(others)———

Shares with full voting rights(treasury stock, etc.)(Shares held astreasury stock)
Common stock
4,109,500——

Shares with full voting rights (others)

Common stock
101,909,400

Class

Common stock

Shares less than one unit

54,756

Total number of shares issued

106,073,656

Total number of voting rights of allshareholders—(Notes)(ii)

1,019,094—(Note) 1(Notes) 1,2——
1,019,094—

1. The columns for the number of shares of “Shares with full voting rights (others)” and “Shares less than one unit”
respectively include 2,700 shares and 84 shares held in the name of Japan Securities Depository Center, Inc.
2. Common stock in the “Shares less than one unit” row includes 3 shares of treasury stock held by the Company.

Treasury StockAs at 30 November 2016

Name or trade name ofholderFAST RETAILING CO.,
LTD.
Total

2.

Holder’s address

717-1 Sayama,
Yamaguchi City,
Yamaguchi—

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

Total numberof shares held
(Shares)

Percentage of
total number ofshares issued (%)

4,109,500—

4,109,500

3.87

4,109,500—

4,109,500

3.87

Board of Directors
Since the submission of the year-end report for the preceding consolidated fiscal year, there has been no change ofdirectors during the three months ended 30 November 2016.

— 14 —

Financial Section
1. Preparation of Interim Condensed Consolidated Financial Statements
The interim condensed consolidated financial statements of the Group were prepared in compliance with International
Accounting Standard 34 “Interim Financial Reporting” (“IAS 34”), pursuant to Article 93 of the “Rules Governing Term, Form andPreparation of Consolidated Quarterly Financial Statements” (2007 Cabinet Office Ordinance No. 64, hereinafter referred to as“Consolidated Quarterly Financial Statements Rules”).
2. Review Certification
Pursuant to the first clause of Article 193-2 of the Financial Instruments and Exchange Act, the quarterly and interim condensed
consolidated financial statements of the Group for the three months ended 30 November 2016, respectively, are reviewed by
Ernst & Young ShinNihon LLC.

— 15 —

(Amounts in millions of Japanese Yen and are rounded down to the nearest million unless otherwise stated)

1. Interim Condensed Consolidated Financial Statements(1)

Interim Condensed Consolidated Statement of Financial Position(Millions of yen)
Notes

ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Other current financial assets
Inventories
Derivative financial assets
Income taxes receivable

As at 31 August 2016

13
6
13

OthersTotal current assets
Non-current assets
Property, plant and equipment
Goodwill
Other intangible assets
Non-current financial assets
nvestments in an associate
Deferred tax assets

7

13

Others

As at 30 November 2016

385,43145,178184,239
270,004569
21,626
17,534

465,691
110,461
207,016
273,625
23,13017,62417,007924,583

1,114,558

121,853
17,90834,20577,553
13,132
44,4284,453

128,394
18,08935,95678,313
13,517
17,2494,854

313,535

296,374

1,238,119

1,410,933

189,501
72,388
12,581
9,602
22,284
31,689257,061901
14,25329,024
14,55948,450338,046364,251

Others274,090
10,645
3,809
13,865275,957
10,874
5,275
15,737

Total non-current liabilities

302,411

307,844

640,458

672,096

10,273
13,070613,974(15,633)(47,183)

10,273
14,237
666,845(15,617)34,702

Non-controlling interests

574,501
23,159710,441
28,395

Total equity

597,661

738,836

1,238,119

1,410,933

Total non-current assets
Total assets
Liabilities and equity
LIABILITIESCurrent liabilities
Trade and other payables
Derivative financial liabilities
Other current financial liabilities
Income taxes payable
Provisions

13
13

OthersTotal current liabilities
Non-current liabilities
Non-current financial liabilities
Provisions
Deferred tax liabilities

13

Total liabilities
EQUITY
Capital stock
Capital surplus
Retained earnings
Treasury stock, at cost
Other components of equity
Equity attributable to owners of the parent

Total liabilities and equity— 16 —

(2)Interim Condensed Consolidated Statement of Profit or Loss and Interim Condensed Consolidated Statement ofComprehensive Income
Interim Condensed Consolidated Statement of Profit or Loss
Three months ended 30 November 2016
(Millions of yen)
Notes

Three months ended
30 November 2015

RevenueThree months ended
30 November 2016

520,303(254,033)

528,847(258,160)

266,269(190,680)
795
(463)

270,686(184,193)
2,765
(667)

75,921
2,119(374)

88,591
16,390(776)

Income taxes

77,666(26,534)

104,204(30,506)

Profit for the period

51,13173,698Non-controlling interests

48,024
3,107

69,695
4,002

Profit for the period

51,13173,698471.07470.48683.51682.60

Cost of sales
Gross profit
Selling, general and administrative expenses
Other income

910

Other expenses

10

Operating profit
Finance income

11

Finance costs

11

Profit before income taxes

Attributable to:
Owners of the parent

Earnings per share
Basic (Yen)
Diluted (Yen)1212— 17 —

Interim Condensed Consolidated Statement of Comprehensive Income
Three months ended 30 November 2016
(Millions of yen)Three months ended
30 November 2015
Profit for the period
Other comprehensive income
Other comprehensive income that will not bereclassified to profit or loss
Other comprehensive income to be reclassified to
profit or loss in subsequent periods
Net gain/(loss) on revaluation ofavailable-for-sale investments
Exchange differences on translation offoreign operations

Three months ended
30 November 2016

51,13173,698

—

—

11

47

3,432
(5,915)

21,182
63,120

Other comprehensive income/(loss), net of taxes(2,471)

84,350Total comprehensive income/(loss) for the period

48,660

158,048

Non-controlling interests

45,012
3,648

151,581
6,467

Total comprehensive income/(loss) for the period

48,660

158,048

Cash flow hedges

Attributable to:
Owners of the parent— 18 —

(3)Interim Condensed Consolidated Statement of Changes in Equity
For three months ended 30 November 2015
(Millions of yen)
Other components of equity

Note
As at 1 September 2015
Net changes during
the period
Comprehensive income
Profit for the period
Other comprehensive
incomeTotal comprehensive
incomeTransactions with theownersAcquisition oftreasury stock
Disposal oftreasury stock
Dividends
Share-based payments
OthersTotal transactions withthe owners
Total net changes
during the period
As at 30 November 2015

8

Treasury Availablestock, atfor-salecostreserve(15,699)
143

Foreigncurrencytranslation
reserve
37,851

Cash-flow
hedge
reserve
104,219

Equityattributableto owners
Nonof the controlling
Totalparentinterests
142,214750,937
23,867

Capitalstock
10,273

Capitalsurplus11,524Retainedearnings
602,623——

48,024

—

—

—

—

—

48,024

3,107

51,131

—

—

—

—

11

2,490

(5,514)(3,012)(3,012)540(2,471)——

48,024

—

11

2,490

(5,514)(3,012)45,012

3,648

48,660

—

—

—

—

—

—

—

—

—

—

—

—
—
—
—

80
—
1,165
—

—
(17,840)
—
—

13
—
—
—

—
—
—
—

—
—
—
—

—
—
—
—

—
—
—
—

93
(17,840)
1,165——(2,067)—121

93(19,907)
1,165
121

—

1,245

(17,840)

13

—

—

—

—

(16,581)(1,945)(18,527)—
10,273

1,245
12,77030,184
632,80813(15,686)

11
154

2,490
40,342(5,514)
98,704(3,012)
139,201

28,430779,368

1,702
25,56930,133804,938— 19 —

Total
equity774,804

For three months ended 30 November 2016
(Millions of yen)
Other components of equity

Note
As at 1 September 2016
Net changes during
the period
Comprehensive income
Profit for the period
Other comprehensive
incomeTotal comprehensive
incomeTransactions withthe owners
Acquisition oftreasury stock
Disposal oftreasury stock
Dividends
Share-based payments
Total transactions withthe owners
Total net changes
during the period
As at 30 November 2016

8

Treasury Availablestock,or-saleat costreserve(15,633)
248

Foreigncurrency Cash-flowtranslation
hedge
reserve
reserve(2,811)(44,619)

Equityattributableto owners
Nonof the controlling
Totalparentinterests(47,183)
574,501
23,159

Capitalstock
10,273

Capitalsurplus13,070Retainedearnings
613,974——

69,695

—

—

—

—

—

69,695

4,002

73,698

—

—

—

—

47

19,982

61,85581,88581,8852,464

84,350——69,695—47

19,982

61,85581,885

151,581

6,467

158,048

—

—

—

—

—

—

—

—

—

—

—

—
—
—

117
—
1,049

—
(16,824)
—

15
—
—

—
—
—

—
—
—

—
—
—

—
—
—

133
(16,824)
1,049—(1,231)—

133(18,055)
1,049

—

1,167

(16,824)

15

—

—

—

—

(15,641)(1,231)(16,873)—
10,273

1,167
14,23752,871
666,845

15(15,617)47
296

19,982
17,17061,855
17,23581,88534,702

135,939
710,441

5,236
28,395

141,175
738,836— 20 —

Total
equity597,661(4)Interim Condensed Consolidated Statement of Cash Flows(Millions of yen)Three months ended
30 November 2015

Profit before income taxes
Depreciation and amortization
Increase/(decrease) in allowance for doubtful accounts
Increase/(decrease) in other provisions
Interest and dividend income
Interest expenses
Foreign exchange losses/(gains)Share of profit and loss of an associate
Losses on retirement of property, plant and equipment
Decrease/(increase) in trade and other receivables
Decrease/(increase) in inventories
Increase/(decrease) in trade and other payables
Decrease/(increase) in other assets
Increase/(decrease) in other liabilities

Three months ended
30 November 2016

77,6669,209(38)(7,770)(417)
374(1,701)—
96(61,221)(11,432)
73,982(1,261)
13,272
1,809

104,2048,552(4)(8,658)(542)
776(15,672)(188)
213(62,006)
4,656
63,515(9,154)22,025(835)

92,567300(289)(34,077)

106,882542(431)(7,107)58,501

99,886

Others, net

6,090(11,116)
1,003(2,359)(1,133)
226
—
(506)
543
75

(2,046)(8,703)—(3,216)(1,079)
237
(196)
(420)
440
(65)

Net cash used in investing activities(7,178)(15,049)

Others, net
SubtotalInterest and dividend income received
Interest paid
Income taxes paid
Net cash from operating activities
Decrease/(increase) in bank deposits
with maturity over 3 months
Purchases of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchases of intangible assets
Payments for lease and guarantee deposits
Proceeds from collection of lease and guarantee deposits
Investment in an associate
Increase in construction assistance fund receivables
Decrease in construction assistance fund receivables— 21 —

(Millions of yen)Note
Net increase/(decrease) in short-termloans payable
Cash dividends paid
Repayments of lease obligations

Three months ended
30 November 2015

Three months ended
30 November 2016

Others, net(2,576)(17,807)(1,147)52(1,231)(16,971)(1,338)(266)

Net cash used in financing activities(21,478)(19,627)2,480

15,051

Cash and cash equivalents at beginning of period

32,324355,21280,260385,431

CASH AND CASH EQUIVALENTS AT END OF PERIOD

387,537

465,6918

Effect of exchange rate changes on cash andcash equivalents
Net increase/(decrease) in cash andcash equivalents— 22 —

Notes to the Interim Condensed Consolidated Financial Statements
1. Reporting Entity
FAST RETAILING CO., LTD. (the “Company”) is a company incorporated in Japan. The locations of the registeredheadquarters and principal offices of the Company are disclosed on the Group’s website (http://www.fastretailing.com/eng/).
The principal activities of the Company and its consolidated subsidiaries (the “Group”) are the UNIQLO business (casual
wear retail business operating under the “UNIQLO” brand in Japan and overseas) and GU business, Theory business (appareldesigning and retail business in Japan and overseas), etc.
2. Basis of Preparation
The interim condensed consolidated financial statements of the Group have been prepared in compliance with
International Accounting Standard 34 “Interim Financial Reporting” (“IAS 34”). The Group meets all criteria of a “specified
company” defined under Article 1-2 of the Rules Governing Term, Form, and Preparation of Consolidated Quarterly Financial
Statements, and accordingly applies Article 93 of the Rules Governing Term, Form, and Preparation of Consolidated
Quarterly Financial Statements. Since the interim condensed consolidated financial statements do not include all theinformation and disclosures required for consolidated financial statements, they should be read in conjunction with theGroup’s annual consolidated financial statements for the year ended 31 August 2016.
The interim condensed consolidated financial statements were approved on 13 January 2017 by Tadashi Yanai, Chairman,
President and CEO, and Takeshi Okazaki, Group Executive Vice President and CFO.

— 23 —

3. Significant Accounting Policies
Except for the following standards that have been newly applied, the accounting policies presented in the consolidated
financial statements for the year ended 31 August 2016, are applied consistently in the preparation of these interim
condensed consolidated financial statements.
The Group adopted the following new and revised standards and interpretations beginning with the preparation of theinterim condensed consolidated financial statements for the three months ended 30 November 2016.
IFRS

Title

Summary of new standards and amendments

IAS 1 (Amendments)

Amendments to IAS 1
Presentation of Financial
Statements

Clarification of methods of presentation of financial
statements and disclosures

IAS16 (Amendments)

Amendments to IAS 16 Property,
Plant and Equipment

Clarification of acceptable methods of depreciation andamortization

IAS 28 (Amendments)

Amendments to IAS 28
Investments in Associates andJoint Ventures

Clarification of items requested regarding accounting
treatment of investment entities

IAS 34 (Amendments)

Amendments to IAS 34
Interim Financial Reporting

Clarifying the handling of information required by IAS 34,
when given in the “Other” section of the financial reports
for the term.

IAS 38 (Amendments)

Amendments to IAS 38
Intangible Assets

Clarification of acceptable methods of depreciation andamortization

IFRS 5 (Amendments)

Amendments to IFRS 5
Non-current Assets Held for Saleand Discontinued Operations

Clarification of accounting treatment of non-current assets,
when the categorization requirements regarding “holding
for purpose of allocation to owner” are no longer met, or
when the category is changed from “holding for purpose ofsale” to “holding for purpose of allocation to owner.”

IFRS 7 (Amendments)

Amendments to IFRS 7
Financial Instruments: Disclosures

Clarification of standards for determination of continuing
involvement in financial assets to be transferred.
Clarification of scope of applicable range for offsetting
financial assets and financial liabilities in financial reports.

IFRS 10 (Amendments)

Amendments to IFRS 10
Consolidated Financial Statements

Clarification of items requested regarding accounting
treatment of investment entities

IFRS 12 (Amendments)

Amendments to IFRS 12— Disclosures of interests inother entities

Sets out the disclosure requirements for investment
entities.

There is no significant impact on the interim condensed consolidated financial statements upon adoption.
4. Use of Estimates and Judgments
The preparation of the interim condensed consolidated financial statements in accordance with IAS 34 requires
management to make judgments, estimates and assumptions that affect the application of accounting policies and thereported 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.
In principle, important estimates and judgments that have significant effects on the amounts recognized in the interim
condensed consolidated financial statements are the same as the preceding consolidated fiscal year.

— 24 —

5. Segment information(i) Description of reportable segments
The Group’s reportable segments are components for which discrete financial information is available and is 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 three reportable operating segments: UNIQLO Japan, UNIQLOInternational and Global Brands, each of which is used to frame and form the Group’s strategy.
The main businesses covered by each reportable segment are as follows:
UNIQLO Japan: UNIQLO clothing business within Japan
UNIQLO International: UNIQLO clothing business outside of Japan
Global Brands: GU, Theory, COMPTOIR DES COTONNIERS, PRINCESSE TAM.TAM and J Brand clothing operations(ii) Method of calculating segment revenue and results
The methods of accounting for the reportable segments are the same as those stated in the “Significant Accounting
Policies” of the Group’s annual consolidated financial statements for the year ended 31 August 2016.
The Group does not allocate assets and liabilities to individual reportable segments.
(iii) Segment information
For the three months ended 30 November 2015
(Millions of yen)
Reportable segments
UNIQLOJapan

UNIQLOInternational

GlobalBrands

Total

Others(Note 1)

Interim
Condensed
Adjustments
Consolidated(Note 2)
Statement ofProfit or Loss

Revenue

230,939

196,943

91,825

519,708595—

520,303

Operating profit

44,821

20,86912,401

78,093(109)(2,062)75,921

Segment income(profit before
income taxes)

44,98820,96012,362

78,311

(109)

(534)

77,666(Note 1) “Others” include real estate leasing business, etc.
(Note 2) “Adjustments” mainly include revenue and corporate expenses which are not allocated to individual reportablesegments.
For the three months ended 30 November 2016
(Millions of yen)
Reportable segments
UNIQLOJapan

UNIQLOInternational

GlobalBrands

Total

Others(Note 1)

Interim
Condensed
Adjustments
Consolidated(Note 2)
Statement ofProfit or Loss

Revenue

238,850

196,554

92,799528,204642—

528,847

Operating profit

45,61330,167

9,582

85,36346

3,181

88,591

Segment income(profit before
income taxes)

48,15030,4729,530

88,15346

16,005104,204(Note 1) “Others” include real estate leasing business, etc.
(Note 2) “Adjustments” mainly include revenue and corporate expenses which are not allocated to individual reportablesegments.

— 25 —

6. Inventories
Write-down of inventories to net realizable value and recognized as expenses is as follows:(Millions of yen)Three months ended Three months ended
30 November 2015 30 November 2016
Write-down of inventories to net realizable value

2,335

3,138

7. Property, plant and equipment
The breakdown of property, plant and equipment at each reporting date is as follows:(Millions of yen)
As at
31 August 2016
Buildings and structures
Furniture, equipment and vehicles
Land
Construction in progress
Lease assets
Total

As at
30 November 2016

81,75913,733
1,962
11,02913,36888,777
14,457
1,962
9,504
13,693

121,853

128,394

8. Dividends
The total amount of dividends paid was as follows:
Dividends paid during the three months ended 30 November 2015
Total dividends(Millions of yen)

Resolution
Meeting of the Board of Directors on 4 November 2015

Dividends per share(Yen)

17,840175

Dividends for which the declared date is 31 August 2015 are paid on or after 11 November 2015 as the effective date.
Dividends paid during the three months ended 30 November 2016
Total dividends(Millions of yen)

Resolution
Meeting of the Board of Directors on 4 November 2016

Dividends per share(Yen)

16,824

165

Dividends for which the declared date is 31 August 2016 are paid on or after 11 November 2016 as the effective date.
9. Selling, general and administrative expenses
The breakdown of selling, general and administrative expenses for each reporting period is as follows:(Millions of yen)Three months ended Three months ended
30 November 2015 30 November 2016
Selling, general and administrative expenses
Advertising and promotion
Rental expenses
Depreciation and amortization
Outsourcing
Salaries
Others23,93545,7699,209
9,024
61,731
41,00922,00844,854
8,552
7,339
60,162
41,275

Total

190,680

184,193— 26 —

10. Other income and other expenses
The breakdown of other income and other expenses for each reporting period is as follows:(Millions of yen)Three months ended Three months ended
30 November 2015 30 November 2016
Other income
Foreign exchange gains*
Gains on sales of property, plant and equipment
Share of profit and loss of an associate
Others
Total

203
7
—
584

2,156
0
188
419

795

2,765

* Currency adjustments incurred in the course of operating transactions are included in “other income”.
(Millions of yen)Three months ended Three months ended
30 November 2015 30 November 2016
Other expenses
Loss on retirement of property, plant and equipment
Others
Total

96
367

213
453

463

667

11. Finance income and finance costs
The breakdown of finance income and finance costs for each reporting period is as follows:(Millions of yen)Three months ended Three months ended
30 November 2015 30 November 2016
Finance income
Foreign exchange gains*
Interest income
Dividend income
Others
Total

1,701
417
0
—

15,672
542
0
175

2,119

16,390* Currency adjustments incurred in the course of non-operating transactions are included in “finance income”.
(Millions of yen)Three months ended Three months ended
30 November 2015 30 November 2016
Finance costs
Interest expenses
Total— 27 —

374

776

374

776

12. Earnings per share
Three months ended 30 November 2015
Equity per share attributable to ownersof the parent (Yen)
Basic earnings per share for the period (Yen)
Diluted earnings per share for the period (Yen)Three months ended 30 November 2016
7,644.70
471.07470.48Equity per share attributable to ownersof the parent (Yen)
Basic earnings per share for the period (Yen)
Diluted earnings per share for the period (Yen)

6,967.28
683.51682.60(Note) The basis for calculation of basic earnings per share and diluted earnings per share for the period is as follows:
Three months ended Three months ended
30 November 2015 30 November 2016
Basic earnings per share for the period
Profit for the period attributable to owners of the parent (Millions of yen)
Profit not attributable to common shareholders (Millions of yen)
Profit attributable to common shareholders (Millions of yen)
Average number of common stock during the period (Shares)
Diluted earnings per share for the period
Adjustment to profit (Millions of yen)
Increase in number of common stock (Shares)(share subscription rights)

48,024—48,024
101,947,408

69,695—69,695
101,966,443—
129,190(129,190)—
136,413(136,413)

13. Fair value of financial instruments
The information about carrying amount and fair value of financial instruments is as follows:(Millions of yen)
As at 31 August 2016
Carrying amounts

Fair value

As at 30 November 2016
Carrying amounts

Fair value

Short-term borrowings
Long-term borrowings (Note)
Corporate bonds
Lease obligations (Note)

3,788
14,120249,486
16,0693,788
14,298
253,850
16,001

2,686
15,301
249,511
17,2092,686
15,474
252,852
17,208

Total

283,465

287,939284,707288,221(Note) The above includes the outstanding balance of borrowings due within 1 year.
The fair value of short-term financial assets, short-term financial liabilities, long-term financial assets and long-term
financial liabilities are measured by amortized cost and approximate their carrying amounts.
The fair value of corporate bonds is measured with reference to market price.
The fair value of long-term borrowings and lease obligations are classified by term, and are calculated on the basis of thecurrent value applying a discount rate that takes into account time remaining to maturity and credit risk.
The following tables illustrate the fair value measurement hierarchy of the Group’s financial instruments. All assets
and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value
hierarchy described as follows:
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
is observable, either directly or indirectly
Level 3 — based on valuation techniques for which the lowest level input that is significant to the fair value measurement
is unobservable— 28 —

① The following tables illustrate the fair value measurement hierarchy of the Group’s financial instruments:(Millions of yen)
As at 31 August 2016

Level 1

Level 2

Level 3

Total

Available-for-sale financial assets
Financial instruments at fair value throughprofit or loss (“FVTPL”)
Foreign currency forward contracts designatedas hedging instruments

1,424

—

212

1,636

—

(8)

—

(8)

—

(71,810)—(71,810)

Total

1,424

(71,818)

212(70,182)(Millions of yen)

As at 30 November 2016

Level 1

Level 2

Level 3

Total

Available-for-sale financial assets
Financial instruments at FVTPL
Foreign currency forward contracts designatedas hedging instruments

763
—

—
0

212
—

976
0

—

22,229—22,229

Total

763

22,229212

23,205For the valuation of level 2 derivative financial instruments for which a market value is available, we use a valuation
model that uses observable data on the measurement date as indicators such as interest rates, yield curves, currency rates
and volatility in comparable instruments.
Unlisted securities are included in level 3. There is no significant increase or decrease in level 3 items through purchase,
disposal or settlement. Also, there is no transfer from level 3 to level 2.
② The financial instruments measured at amortized cost
The fair value measurements for corporate bonds, long-term borrowings and lease obligations are classified as level 2.
14. Commitments
The Group had the following commitments at each reporting dates:(Millions of yen)
As at
31 August 2016
Commitment for acquisition of property, plant and equipment
Commitment for acquisition of intangible assets
Total

As at
30 November 2016

9,889
399

7,537
175

10,288

7,712

15. Subsequent Events
Not applicable.

2. Others
Dividends
The Company resolved to pay a dividend from retained earnings at the meeting of the Board of Directors convened on 4
November 2016.
The total amount of dividend and amount per share are stated under “Financial section 1. Interim Condensed
Consolidated Financial Statements, Notes to the Interim Condensed Consolidated Financial Statements 8. Dividends”.

— 29 —

Report on review of interim condensed consolidated financial statements
Board of Directors
FAST RETAILING CO., LTD.
Ernst & Young ShinNihon LLC
Masayuki Miyairi
Certified Public Accountant
Designated and Engagement Partner
Tomo Ito
Certified Public Accountant
Designated and Engagement Partner
Pursuant to first clause of Article 193-2 of the Financial Instruments and Exchange Act, we have reviewed the interim condensed
consolidated financial information included in the financial section, which comprises the interim condensed consolidated
statement of financial position of FAST RETAILING CO., LTD. (the “Company”) and its subsidiaries (collectively, the “Group”)
as at 30 November 2016, and the related interim condensed consolidated statement of profit or loss and interim condensed
consolidated statement of comprehensive income, interim condensed consolidated statement of changes in equity and interim
condensed consolidated statement of cash flows for the three -month period then ended, and other explanatory notes (the“Interim Financial Information”).
Management’s responsibility for the interim condensed consolidated financial statements
Management is responsible for the preparation and fair presentation of the Interim Financial Information in accordance with
International Accounting Standard 34 “Interim Financial Reporting” (“IAS 34”), pursuant to Article 93 of the “Rules GoverningTerm, Form and Preparation of Consolidated Quarterly Financial Statements”, and for such internal control as management
determines is necessary to enable the preparation of interim condensed consolidated financial statements that are free frommaterial misstatement, whether due to fraud or error.
Auditors’ responsibility
Our responsibility is to express a conclusion on the Interim Financial Information based on our review. Our report is made solely
to you, as a body, and for no other purpose. We do not assume responsibility towards or accept liability to any other person forthe contents of this report.
We conducted our review in accordance with quarterly review standards generally accepted in Japan. A review of Interim
Financial Information consists of making inquiries, primarily of persons responsible for financial and accounting matters, andapplying analytical and other quarterly review procedures. A review is substantially less in scope than an audit conducted inaccordance with auditing standards generally accepted in Japan and consequently does not enable us to obtain assurance that
we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit
opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed
consolidated financial statements are not prepared, in all material respects, in accordance with IAS 34.
Conflicts of Interest
We have no interest in the Company which should be disclosed in compliance with the Certified Public Accountants Act.

Ernst & Young ShinNihon LLC
Tokyo, Japan
13 January 2017
(Note)
This is an English translation of the Japanese language Independent Auditors’ Report issued by Ernst & Young ShinNihon LLC in
connection with the review of the interim condensed consolidated financial statements of the Group prepared in Japanese forthe period ended 30 November 2016. Ernst & Young ShinNihon LLC has not reviewed the English language version of the interim
condensed consolidated financial statements for the above mentioned period.
— 30 —