Director, Pearl Hill Advisors

Nicholas Tanner

Director

Pearl Hill Advisors

Equity Bottom-Up

<p>United Arrows operates some 361 fashion outlets in Japan.  44% of sales are ladies, 30% men’s wear and 10% accessories. Average spend at “United Arrows” is Y20,000.</p><p>First half sales rose 2% to Y65.1bn but operating profit fell 53% to Y1.7bn. The full year operating profit forecast was revised down from Y11.3bn to Y9.1bn (-18%). This is now said to be conservative. First half numbers were worse than expected as existing store sales fell 0.1% vs. the forecast growth of 3.8%. If there was any good…</p>

United Arrows operates some 361 fashion outlets in Japan.  44% of sales are ladies, 30% men’s wear and 10% accessories. Average spend at “United Arrows” is Y20,000.First half sales rose 2% to Y65.1bn but operating profit fell 53% to Y1.7bn. The full year operating profit forecast was revised down from Y11.3bn to Y9.1bn (-18%). This is now said to be conservative. First half numbers were worse than expected as existing store sales fell 0.1% vs. the forecast growth of 3.8%. If there was any good…

Not Overly Expensive on 14x and They Yield 2.7%.