Form 8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) May 20, 2013

 

 

URBAN OUTFITTERS, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

 

Pennsylvania   000-22754   23-2003332

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

5000 South Broad Street, Philadelphia, PA   19112
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code (215) 454-5500

N/A

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.02. Results of Operations and Financial Condition

On May 20, 2013, Urban Outfitters, Inc. (the “Company”) issued an earnings release, which is attached hereto as Exhibit 99.1 and incorporated herein by reference. The earnings release disclosed material non-public information regarding the Company’s earnings for the three months ended April 30, 2013.

 

Item 9.01. Financial Statements and Exhibits

 

99.1    Earnings Release dated May 20, 2013 – Operating results for the three months ended April 30, 2013.

 

- 1 -


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    URBAN OUTFITTERS, INC.
Date: May 21, 2013     By:  

/s/ Francis J. Conforti

      Francis J. Conforti
      Chief Financial Officer

 

- 2 -


Exhibit Index

 

Exhibit
No.

  

Description

EX-99.1    Earnings Release dated May 20, 2013 – Operating results for the three months ended April 30, 2013.

 

- 3 -

EX-99.1

Exhibit 99.1

 

URBAN OUTFITTERS, INC.

First Quarter Results

Philadelphia, PA – May 20, 2013

 

For Immediate Release   Contact:    Oona McCullough
     Director of Investor Relations
     (215) 454-4806

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,  
     2013      2012  

Net sales by brand

     

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)


URBAN OUTFITTERS, INC.

Condensed Consolidated Statements of Income

(in thousands, except share and per share data)

(unaudited)

 

     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   

AS A PERCENT OF NET SALES

    

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
  

 

 

   

 

 

 


URBAN OUTFITTERS, INC.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

(unaudited)

 

     April 30,
2013
    January 31,
2013
    April 30,
2012
 
ASSETS       

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   
  

 

 

   

 

 

   

 

 

 
LIABILITIES AND SHAREHOLDERS’ EQUITY       

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