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Urban Outfitters Reports Record Sales and a 39% Increase in Earnings

        PHILADELPHIA, PA, May 20, 2013 - 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 $47 million for the three months ended April 30, 2013.  Earnings per diluted share were $0.32 for the quarter.

Total Company net sales for the first quarter of fiscal 2014 increased to a record $648 million or 14% over the same quarter last year. Comparable retail segment net sales, which include our comparable direct-to-consumer channel, increased 9%.  Comparable retail segment net sales increased 44% at Free People, 8% at Anthropologie and 6% at Urban Outfitters. Wholesale segment net sales rose 16%.

"Our brands delivered solid growth across all channels in the first quarter, especially in our direct-to-consumer channel," said Chief Executive Officer, Richard A. Hayne. "Our focus on the direct-to-consumer channel has paid off nicely and we plan to continue to make the investments necessary to support its robust growth," finished Mr. Hayne.

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

     Three Months Ended
      April 30,
Net sales by brand      2013      2012
Urban Outfitters $  292,790 $      266,390
Anthropologie 265,068 235,118
Free People 83,324 61,672
Other 6,995 5,750
Total Company $  648,177 $      568,930
Net sales by segment
Retail Segment $  611,971 $      537,746
Wholesale Segment 36,206 31,184
Total Company $  648,177 $      568,930

For the three months ended April 30, 2013, the gross profit rate improved by 125 basis points versus the prior year's comparable period.  The improvement in gross profit rate was primarily due to a reduction in merchandise markdowns primarily driven by improvements at the Anthropologie brand. We also improved our initial merchandise margins and leveraged store occupancy expenses.  These improvements were partially offset by a deleveraging of delivery expense primarily related to an increase in direct-to-consumer net sales penetration.

As of April 30, 2013, total inventories increased by $26 million, or 9%, on a year-over-year basis. The growth in total inventories is primarily related to the acquisition of inventory to stock new and non-comparable stores. Comparable retail segment inventories increased 1% driven primarily by additional inventory to fuel our strong direct-to-consumer growth rate.

        For the three months ended April 30, 2013, selling, general and administrative expenses, expressed as a percentage of net sales, decreased by 70 basis points compared to the prior year period.  The leverage was primarily due to improvements in direct store controllable and selling support expenses driven by the strong positive retail segment sales.  

        During the three months ended April 30, 2013, the Company opened a total of seven new stores including: three Free People stores, two Urban Outfitters stores and two Anthropologie stores, and closed one Urban Outfitters store.

Urban Outfitters, Inc. is an innovative specialty retail company which offers a variety of lifestyle merchandise to highly defined customer niches through 216 Urban Outfitters stores in the United States, Canada, and Europe, catalogs and websites; 182 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, 80 Free People stores in the United States and Canada, catalogs and websites; 2 BHLDN stores and a website and 2 Terrain garden centers and a website, as of April 30, 2013.

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://www.media-server.com/m/p/mtijqm4n

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," "will," "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, natural disasters or severe weather conditions, 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 executives, 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, 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,
          2013         2012
Net sales $      648,177 $     568,930
Cost of sales 409,368 366,451
          Gross profit 238,809 202,479
Selling, general and administrative expenses 165,843 149,564
          Income from operations 72,966 52,915
Other income, net (129) 299
          Income before income taxes 72,837 53,214
Income tax expense 25,779 19,257
          Net income $        47,058 $      33,957
Net income per common share:
       Basic $            0.32   $      0.24
       Diluted $            0.32   $      0.23
Weighted average common shares and common
   share equivalents outstanding:
       Basic 146,289,751 144,709,199
       Diluted 148,799,056 145,568,667
Net sales 100.0% 100.0%
Cost of sales   63.2% 64.4%
          Gross profit 36.8% 35.6%
Selling, general and administrative expenses   25.5% 26.3%
           Income from operations 11.3% 9.3%
Other income, net     (0.1%) 0.1%
         Income before income taxes 11.2% 9.4%
Income tax expense     3.9% 3.4%
          Net income    7.3% 6.0%

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


 April 30,
January 31,
April 30,

Current assets:
    Cash and cash equivalents   $   273,464 $   245,327 $   130,462
    Marketable securities   214,938 228,486 117,056
    Accounts receivable, net of allowance for doubtful accounts
        of $1,274, $1,681 and $1,799, respectively        48,868 39,519 43,882
    Inventories   325,471 282,411 299,750
    Prepaid expenses, deferred taxes and other current assets          91,829        76,541        84,738
            Total current assets 954,570 872,284 675,888
Property and equipment, net   721,872 733,416 711,932
Marketable securities   149,771 149,585 91,231
Deferred income taxes and other assets          43,190        41,926        76,293
           Total Assets   $ 1,869,403 $ 1,797,211 $ 1,555,344
Current liabilities:
    Accounts payable   $    128,528 $     99,059 $    117,806
    Accrued expenses, accrued compensation and other current liabilities         121,506       151,136       137,398
           Total current liabilities   250,034 250,195 255,204
Deferred rent and other liabilities        193,468        192,428        187,819  
           Total Liabilities        443,502      442,623      443,023
Shareholders' equity:
   Preferred shares; $.0001 par value, 10,000,000 shares authorized, none issued - - -
   Common shares; $.0001 par value, 200,000,000 shares authorized, 146,813,217,
       146,015,767 and 144,808,807 issued and outstanding respectively   15 15 15
    Additional paid-in-capital   74,618 48,276 5,971
    Retained earnings   1,362,137 1,315,079 1,111,722
    Accumulated other comprehensive loss        (10,869)        (8,782)        (5,387)
           Total Shareholders' Equity     1,425,901   1,354,588   1,112,321
           Total Liabilities and Shareholders' Equity     $ 1,869,403 $ 1,797,211 $ 1,555,344


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