<<  Back

Urban Outfitters, Inc. Reports Record Q1 Sales

        PHILADELPHIA, PA May 21, 2012 - Urban Outfitters, Inc. (NASDAQ:URBN), a leading lifestyle specialty retail company operating under the Anthropologie, BHLDN, Free People, Terrain and Urban Outfitters brands, today announced net income of $34 million or earnings per diluted share of $0.23 for the three months ended April 30, 2012.

Total Company net sales rose by 9% over the same quarter last year to $569 million.  Comparable retail segment net sales, which include our Direct-to-Consumer channels, increased 2% for the quarter, while comparable store net sales decreased 1%. Comparable retail segment net sales at Free People and Urban Outfitters increased 2%, and 6%, respectively, while comparable retail segment net sales at Anthropologie decreased 2% for the quarter. Direct-to-Consumer comparable net sales increased 15% and wholesale segment net sales increased 2% for the quarter.

"We are pleased to announce record first quarter sales that were driven in part by positive regular price 'comp' sales," said Chief Executive Officer, Richard A. Hayne.  "We are encouraged by the customer response to the steady progress our brands have made in creative and product execution," finished Mr. Hayne.

Net sales by brand and channel for the three month periods were as follows:

 Three Months Ended
 April 30,
(in thousands)
     2012  2011
Net sales by brand
Urban Outfitters
 $    266,390  $   235,328
Anthropologie          235,118       228,548
Free People            61,672      51,751
Other            5,750        8,392
Total Company  $    568,930  $   524,019
Net sales by channel
Retail Stores  $   420,638  $   391,164    
Direct-to-Consumer 117,108 102,298        
Retail Segment 537,746 493,462        
Wholesale Segment 31,184           30,557          
Total Company  $   568,930  $   524,019

For the first quarter ended April 30, 2012, the gross profit rate declined by 131 basis points versus the prior year's comparable period. The decline in the rate was primarily due to occupancy deleverage related to an increased number of store openings versus the prior comparable quarter, as well as, an increased number of new and non-comparable European stores. Also contributing to the rate decline, were slightly higher markdowns on a few women's apparel categories across all brands.

As of April 30, 2012, total inventories increased by $36 million or 13%, on a year-over-year basis. The growth in total inventories is primarily due to an increase in total comparable retail segment inventories of 11% at cost and 5% in units, while total comparable store inventories increased 8% at cost. The remainder of the increase was related to the acquisition of inventory to stock new and non-comparable stores and the growth in the wholesale business.

        For the first quarter ended April 30, 2012, selling, general and administrative expenses, expressed as a percentage of net sales, increased by 62 basis points.  This increase was primarily due to the deleveraging of direct store controllable expenses driven by the negative comparable store net sales.

        During the three months ended April 30, 2012, the Company opened a total of 14 new stores including: 7 Free People stores, 4 Urban Outfitters stores, 2 Anthropologie stores and 1 BHLDN store.  

Urban Outfitters, Inc. is an innovative specialty retail company which offers a variety of lifestyle merchandise to highly defined customer niches through 201 Urban Outfitters stores in the United States, Canada, and Europe, catalogs and websites; 170 Anthropologie stores in the United States, Canada and Europe, catalogs and websites; Free People wholesale, which sells its product to approximately 1,400 specialty stores and select department stores, 69 Free People stores, catalogs and website; 2 BHLDN stores and a website and 1 Terrain garden center and website, as of April 30, 2012.

Management's first quarter commentary is located on our website at www.urbanoutfittersinc.com.   A conference call will be held today to discuss first quarter results and will be webcast at 5:00 pm. EDT at:  http://edge.media-server.com/m/p/5ncua79g/lan/en

This news release is being made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Certain matters contained in this release may constitute forward-looking statements. When used in this release, the words "project," "believe," "plan," "anticipate," "expect" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Any one, or all, of the following factors could cause actual financial results to differ materially from those financial results mentioned in the forward-looking statements: the difficulty in predicting and responding to shifts in fashion trends, changes in the level of competitive pricing and promotional activity and other industry factors, overall economic and market conditions and the resultant impact on consumer spending patterns, lowered levels of consumer confidence and higher levels of unemployment, continuation of lowered levels of consumer spending resulting from the continuing worldwide economic downturn and related debt crisis, any effects of terrorist acts or war, availability of suitable retail space for expansion, timing of store openings, risks associated with international expansion, seasonal fluctuations in gross sales, the departure of one or more key senior managers, import risks, including potential disruptions and changes in duties, tariffs and quotas, the closing of any of our distribution centers, our ability to protect our intellectual property rights, risks associated with internet sales, response to new store concepts, potential difficulty liquidating certain marketable security investments, changes in accounting standards and subjective assumptions, regulatory changes and legal matters and other risks identified in the Company's filings with the Securities and Exchange Commission. The Company disclaims any intent or obligation to update forward-looking statements even if experience or future changes make it clear that actual results may differ materially from any projected results expressed or implied therein.




(Tables follow)


Condensed Consolidated Statements of Income

(in thousands, except share and per share data)

                                                                                        Three Months Ended                     
                                                                                                             April 30,               

          2012         2011
Net sales   $   568,930   $    524,019
Cost of sales, including certain buying,  
  distribution and occupancy costs      366,451       330,654
          Gross profit 202,479            193,365
Selling, general and administrative expenses      149,564       134,529
          Income from operations 52,915 58,836
Other income, net             299           1,365
          Income before income taxes 53,214 60,201
Income tax expense         19,257         21,577
          Net income $      33,957 $      38,624
Net income per common share:
       Basic $          0.24 $          0.24
       Diluted $          0.23 $          0.23
Weighted average common shares and common
   share equivalents outstanding:
       Basic 144,709,199 162,407,330
       Diluted 145,568,667 165,293,594
Net sales 100.0% 100.0%
Cost of sales, including certain buying,
   distribution and occupancy costs     64.4%     63.1%
          Gross profit 35.6% 36.9%
Selling, general and administrative expenses     26.3%     25.7%
           Income from operations 9.3% 11.2%
Other income, net      0.1%  0.3%
         Income before income taxes 9.4% 11.5%
Income tax expense       3.4%       4.1%
          Net income    6.0%  7.4%

Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)


 April 30,
January 31,
April 30,

Current assets:
    Cash and cash equivalents        $   130,462 $   145,273 $   243,939

    Marketable securities        117,056 89,854 68,688
    Accounts receivable, net of allowance for doubtful accounts
        of $1,799, $1,614 and $1,078, respectively        43,882 36,673 46,539
    Inventories        299,750 250,073 264,278
    Prepaid expenses, deferred taxes and other current assets               84,738        75,119 77,846
            Total current assets 675,888 596,992 701,290
Property and equipment, net   711,932 684,979 601,249
Marketable securities   91,231 126,913 333,946
Deferred income taxes and other assets          76,293        74,824 57,774
           Total Assets        $ 1,555,344 $ 1,483,708 $ 1,694,259
Current liabilities:
    Accounts payable        $    117,806 $     95,754 $   109,444
    Accrued expenses, accrued compensation and other current liabilities              137,398       137,712       102,562
           Total current liabilities        255,204 233,466 212,006
Deferred rent and other liabilities        187,819       183,974        169,773  
           Total Liabilities             443,023      417,440     381,779
Shareholders' equity:  
   Preferred shares; $.0001 par value, 10,000,000 shares authorized, none issued - - -
   Common shares; $.0001 par value, 200,000,000 shares authorized, 144,808,807,
       144,633,007 and 159,667,925 issued and outstanding respectively        15 15 16
    Additional paid-in-capital   - - -
    Retained earnings        1,117,693 1,077,765 1,317,036
    Accumulated other comprehensive loss               (5,387)       (11,512)      (4,572)
           Total Shareholders' Equity          1,112,321   1,066,268   1,312,480
           Total Liabilities and Shareholders' Equity                $ 1,555,344 $ 1,483,708 $ 1,694,259

Oona McCullough
Director of Investor Relations
(215) 454-4806