8-K
0000912615false00009126152024-05-212024-05-21

 

 

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 21, 2024

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))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Shares, par value $.0001 per share

 

URBN

 

NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule l2b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 


 

 

 

Item 8.01.

Other Events

On May 21, 2024, 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, 2024.

Item 9.01.

Financial Statements and Exhibits

Exhibit No.

Description

 

 

99.1

Earnings Release dated May 21, 2024 – Operating results for the three months ended April 30, 2024

104

Cover Page Interactive Data File (embedded within the Inline XBRL document)

- 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 22, 2024

 

By:

/s/ Melanie Marein-Efron

 

 

 

 

Melanie Marein-Efron

 

 

 

 

Chief Financial Officer

- 2 -

 


EX-99.1

 

Exhibit 99.1

URBAN OUTFITTERS, INC.

First Quarter Results

Philadelphia, PA – May 21, 2024

For Immediate Release

Contact:

Oona McCullough

 

 

Executive Director of Investor Relations

 

 

(215) 454-4806

URBN Reports Record Q1 Sales and Earnings

PHILADELPHIA, PA, May 21, 2024 – Urban Outfitters, Inc. (NASDAQ:URBN), a leading lifestyle products and services company which operates a portfolio of global consumer brands including the Anthropologie, Free People, FP Movement, Urban Outfitters and Nuuly brands, today announced net income of $61.8 million and record first quarter earnings per diluted share of $0.65 for the three months ended April 30, 2024. For the three months ended April 30, 2024, adjusted net income was $65.5 million and adjusted earnings per diluted share were $0.69. Adjusted net income and earnings per diluted share for the three months ended April 30, 2024, excludes store impairment and lease abandonment charges. See "Reconciliation of Non-GAAP Financial Measures" included at the end of this release.

Total Company net sales for the three months ended April 30, 2024, increased 7.8% to a record $1.20 billion. Total Retail segment net sales increased 5.8%, with comparable Retail segment net sales increasing 4.6%. The increase in Retail segment comparable net sales was driven by high single-digit positive growth in digital channel sales and low single-digit positive growth in retail store sales. Comparable Retail segment net sales increased 17.1% at Free People and 10.4% at Anthropologie and decreased 13.7% at Urban Outfitters. Wholesale segment net sales increased 3.4% driven by a 6.3% increase in Free People wholesale sales due to an increase in sales to department stores and specialty customers, partially offset by a decrease in Urban Outfitters wholesale sales. Nuuly segment net sales increased by 51.4% primarily driven by a 45% increase in average active subscribers in the current quarter versus the prior year quarter.

“We are pleased to report record first quarter sales and earnings driven by continued strength at the Anthropologie, Free People, FP Movement and Nuuly brands,” said Richard A. Hayne, Chief Executive Officer. “Customer demand remains robust for our spring and summer fashion, which bodes well for continued sales growth in Q2,” finished Mr. Hayne.

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

 

Three Months Ended

 

 

April 30,

 

 

2024

 

 

2023

 

Net sales by brand

 

 

 

 

 

Anthropologie(1)

$

526,385

 

 

$

473,640

 

Free People(2)

 

318,691

 

 

 

273,735

 

Urban Outfitters

 

270,258

 

 

 

308,708

 

Nuuly

 

77,942

 

 

 

51,470

 

Menus & Venues

 

7,456

 

 

 

6,121

 

Total Company

$

1,200,732

 

 

$

1,113,674

 

 

 

 

 

 

 

Net sales by segment

 

 

 

 

 

Retail Segment

$

1,062,685

 

 

$

1,004,101

 

Nuuly Segment

 

77,942

 

 

 

51,470

 

Wholesale Segment

 

60,105

 

 

 

58,103

 

Total Company

$

1,200,732

 

 

$

1,113,674

 

(1)
Anthropologie includes the Anthropologie and Terrain brands.
(2)
Free People includes the Free People and FP Movement brands.

 


 

For the three months ended April 30, 2024, the gross profit rate increased by 68 basis points compared to the three months ended April 30, 2023, and gross profit dollars increased 10.0% to $408.4 million from $371.2 million. For the three months ended April 30, 2024, the adjusted gross profit rate increased by 106 basis points compared to the three months ended April 30, 2023, and adjusted gross profit dollars increased 11.2% to $413.0 million from $371.2 million. The increase in adjusted gross profit rate was primarily due to higher initial merchandise markups for all brands primarily driven by Company cross-functional initiatives, partially offset by higher merchandise markdowns, primarily at the Urban Outfitters brand, and a deleverage in logistics expenses. The deleverage in logistics expenses was primarily driven by the increased penetration of Nuuly segment sales to total Company sales, as well as transition and start-up expenses related to the additional Nuuly fulfillment facility that opened during the three months ended April 30, 2024. The increase in adjusted gross profit dollars was due to higher net sales and the improved adjusted gross profit rate.

As of April 30, 2024, total inventory decreased by $11.3 million, or 1.9%, compared to total inventory as of April 30, 2023. Total Retail segment inventory decreased 2.3%, while Retail segment comparable inventory decreased 4.7%. Wholesale segment inventory increased by 2.1%.

For the three months ended April 30, 2024, selling, general and administrative expenses increased by $33.9 million, or 11.3%, compared to the three months ended April 30, 2023, and expressed as a percentage of net sales, deleveraged 87 basis points. The deleverage in selling, general and administrative expenses as a rate to net sales was primarily related to the Urban Outfitters brand not being able to reduce expenses at the same rate of net sales. The dollar growth in selling, general and administrative expenses was primarily related to increased marketing expenses to support double-digit customer traffic growth and increased sales at the Free People, FP Movement, Anthropologie and Nuuly brands and increased store payroll expenses to support the retail stores comparable sales growth.

The Company’s effective tax rate for the three months ended April 30, 2024 was 23.6%, compared to 27.1% in the three months ended April 30, 2023. The Company's adjusted effective tax rate for the three months ended April 30, 2024 was 23.4%, compared to 27.1% in the three months ended April 30, 2023. The decrease in the adjusted effective tax rate for the three months ended April 30, 2024 was primarily due to the favorable impact of equity activity in the current year quarter.

Net income for the three months ended April 30, 2024 was $61.8 million and record first quarter earnings per diluted share were $0.65. Adjusted net income for the three months ended April 30, 2024 was $65.5 million and adjusted earnings per diluted share were $0.69.

On June 4, 2019, the Company’s Board of Directors authorized the repurchase of 20 million common shares under a share repurchase program. During the year ended January 31, 2024 and the three months ended April 30, 2024, the Company did not repurchase any common shares. As of April 30, 2024, 19.2 million common shares were remaining under the program.

During the three months ended April 30, 2024, the Company opened a total of 8 new retail locations including: 4 Urban Outfitters stores, 2 Anthropologie stores and 2 Free People stores (including 1 FP Movement store); and closed 4 retail locations including: 2 Urban Outfitters stores, 1 Anthropologie store and 1 Free People store.

Urban Outfitters, Inc. offers lifestyle-oriented general merchandise and consumer products and services through a portfolio of global consumer brands comprised of 264 Urban Outfitters stores in the United States, Canada and Europe and websites; 238 Anthropologie stores in the United States, Canada and Europe, catalogs and websites; 199 Free People stores (including 39 FP Movement stores) in the United States, Canada and Europe, catalogs and websites, 9 Menus & Venues restaurants, 7 Urban Outfitters franchisee-owned stores and 2 Anthropologie franchisee-owned stores as of April 30, 2024. Free People, FP Movement and Urban Outfitters wholesale sell their products through department and specialty stores worldwide, digital businesses and the Company’s Retail segment. Nuuly is a women's apparel subscription rental service which offers a wide selection of rental product from the Company's own brands, third-party brands and one-of-a-kind vintage pieces.

A conference call will be held today to discuss first quarter results and will be webcast at 5:15 pm. ET at: https://edge.media-server.com/mmc/p/7xcp7gbo/.

As used in this document, unless otherwise defined, "Anthropologie" refers to the Company's Anthropologie and Terrain brands and "Free People" refers to the Company's Free People and FP Movement brands.

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 contain 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: overall economic and market conditions (including current levels of inflation) and worldwide political events and the resultant impact on consumer spending patterns and our pricing power, 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, the effects of the implementation of the United Kingdom's withdrawal from membership in the European Union (commonly referred to as “Brexit”), including currency fluctuations, economic conditions and legal or regulatory changes, any effects of war, including geopolitical instability, impacts of the conflict in the Middle East and impacts of the war between Russia and Ukraine and from related sanctions imposed by the United States, European Union, United Kingdom and others, terrorism and civil unrest, natural disasters, severe or unseasonable weather conditions (including as a result of climate change) or public health crises (such as the coronavirus (COVID-19)), labor shortages and increases in labor costs, raw material costs and transportation costs, availability of suitable retail space for expansion, timing of store openings, risks associated with international expansion, seasonal fluctuations in gross sales, response to new concepts, our ability to integrate acquisitions, risks associated with digital sales, our ability to maintain and expand our digital sales channels, any material disruptions or security breaches with respect to our technology systems, the departure of one or more key senior executives, import risks (including any shortage of transportation capacities or delays at ports), changes to U.S. and foreign trade policies (including the enactment of tariffs, border adjustment taxes or increases in duties or quotas), the unexpected closing or disruption of, or any damage to, any of our distribution centers, our ability to protect our intellectual property rights, failure of our manufacturers and third-party vendors to comply with our social compliance program, risks related to environmental, social and governance activities, changes in our effective income tax rate, changes in accounting standards and subjective assumptions, regulatory changes and legal matters and other risks identified in our 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

(amounts in thousands, except share and per share data)

(unaudited)

 

 

Three Months Ended

 

 

April 30,

 

 

2024

 

 

2023

 

Net sales

$

1,200,732

 

 

$

1,113,674

 

Cost of sales (excluding store impairment and lease abandonment charges)

 

787,746

 

 

 

742,443

 

Store impairment and lease abandonment charges

 

4,601

 

 

 

 

          Gross profit

 

408,385

 

 

 

371,231

 

Selling, general and administrative expenses

 

333,761

 

 

 

299,848

 

          Income from operations

 

74,624

 

 

 

71,383

 

Other income, net

 

6,246

 

 

 

1,019

 

         Income before income taxes

 

80,870

 

 

 

72,402

 

Income tax expense

 

19,105

 

 

 

19,585

 

          Net income

$

61,765

 

 

$

52,817

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

       Basic

$

0.66

 

 

$

0.57

 

       Diluted

$

0.65

 

 

$

0.56

 

 

 

 

 

 

 

Weighted-average common shares outstanding:

 

 

 

 

 

       Basic

 

93,124,568

 

 

 

92,474,688

 

       Diluted

 

95,000,706

 

 

 

93,821,292

 

 

 

 

 

 

 

 

 

 

 

 

 

AS A PERCENTAGE OF NET SALES

 

 

 

 

 

Net sales

 

100.0

%

 

 

100.0

%

Cost of sales (excluding store impairment and lease abandonment charges)

 

65.6

%

 

 

66.7

%

Store impairment and lease abandonment charges

 

0.4

%

 

 

 

         Gross profit

 

34.0

%

 

 

33.3

%

Selling, general and administrative expenses

 

27.8

%

 

 

26.9

%

          Income from operations

 

6.2

%

 

 

6.4

%

Other income, net

 

0.5

%

 

 

0.1

%

         Income before income taxes

 

6.7

%

 

 

6.5

%

Income tax expense

 

1.6

%

 

 

1.8

%

          Net income

 

5.1

%

 

 

4.7

%

 

 


 

URBAN OUTFITTERS, INC.

Condensed Consolidated Balance Sheets

(amounts in thousands, except share data)

(unaudited)

 

 

April 30,

 

 

January 31,

 

 

April 30,

 

 

2024

 

 

2024

 

 

2023

 

ASSETS

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

    Cash and cash equivalents

$

173,995

 

 

$

178,321

 

 

$

171,655

 

    Marketable securities

 

312,558

 

 

 

286,744

 

 

 

209,777

 

    Accounts receivable, net of allowance for doubtful accounts
         of $933, $1,465 and $1,453, respectively

 

88,297

 

 

 

67,008

 

 

 

105,589

 

    Inventory

 

578,990

 

 

 

550,242

 

 

 

590,326

 

    Prepaid expenses and other current assets

 

219,886

 

 

 

200,188

 

 

 

223,894

 

            Total current assets

 

1,373,726

 

 

 

1,282,503

 

 

 

1,301,241

 

Property and equipment, net

 

1,304,548

 

 

 

1,286,541

 

 

 

1,201,506

 

Operating lease right-of-use assets

 

910,965

 

 

 

920,396

 

 

 

921,893

 

Marketable securities

 

287,178

 

 

 

314,152

 

 

 

86,156

 

Other assets

 

312,285

 

 

 

307,617

 

 

 

281,874

 

           Total Assets

$

4,188,702

 

 

$

4,111,209

 

 

$

3,792,670

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

    Accounts payable

$

321,443

 

 

$

253,342

 

 

$

263,558

 

    Current portion of operating lease liabilities

 

224,100

 

 

 

226,645

 

 

 

233,085

 

    Accrued expenses, accrued compensation and other
         current liabilities

 

488,681

 

 

 

514,218

 

 

 

431,033

 

           Total current liabilities

 

1,034,224

 

 

 

994,205

 

 

 

927,676

 

Non-current portion of operating lease liabilities

 

849,917

 

 

 

851,853

 

 

 

845,643

 

Other non-current liabilities

 

142,227

 

 

 

152,611

 

 

 

168,669

 

           Total Liabilities

 

2,026,368

 

 

 

1,998,669

 

 

 

1,941,988

 

 

 

 

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

 

 

 

 

 

    Preferred shares; $.0001 par value, 10,000,000 shares
         authorized, none issued

 

 

 

 

 

 

 

 

    Common shares; $.0001 par value, 200,000,000 shares
         authorized, 93,379,211, 92,787,522, and 92,677,835 shares issued
         and outstanding, respectively

9

 

 

9

 

 

9

 

    Additional paid-in-capital

 

31,572

 

 

 

37,943

 

 

 

15,133

 

    Retained earnings

 

2,175,500

 

 

 

2,113,735

 

 

 

1,878,878

 

    Accumulated other comprehensive loss

 

(44,747

)

 

 

(39,147

)

 

 

(43,338

)

           Total Shareholders’ Equity

 

2,162,334

 

 

 

2,112,540

 

 

 

1,850,682

 

           Total Liabilities and Shareholders’ Equity

$

4,188,702

 

 

$

4,111,209

 

 

$

3,792,670

 

 

 


 

URBAN OUTFITTERS, INC.

Condensed Consolidated Statements of Cash Flows

(amounts in thousands)

(unaudited)

 

 

 

Three Months Ended

 

 

 

April 30,

 

 

 

2024

 

 

2023

 

Cash flows from operating activities:

 

 

 

 

 

 

Net income

 

$

61,765

 

 

$

52,817

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

27,761

 

 

 

23,879

 

Non-cash lease expense

 

 

51,470

 

 

 

50,859

 

Provision for deferred income taxes

 

 

12,735

 

 

 

2,457

 

Share-based compensation expense

 

 

7,599

 

 

 

7,735

 

Amortization of tax credit investment

 

 

4,380

 

 

 

3,976

 

Store impairment and lease abandonment charges

 

 

4,601

 

 

 

 

Loss on disposition of property and equipment, net

 

 

135

 

 

 

222

 

Changes in assets and liabilities:

 

 

 

 

 

 

Receivables

 

 

(21,512

)

 

 

(35,030

)

Inventory

 

 

(29,818

)

 

 

(1,649

)

Prepaid expenses and other assets

 

 

(37,542

)

 

 

(35,045

)

Payables, accrued expenses and other liabilities

 

 

36,663

 

 

 

22,257

 

Operating lease liabilities

 

 

(59,686

)

 

 

(56,201

)

Net cash provided by operating activities

 

 

58,551

 

 

 

36,277

 

Cash flows from investing activities:

 

 

 

 

 

 

Cash paid for property and equipment

 

 

(41,091

)

 

 

(32,904

)

Cash paid for marketable securities

 

 

(95,799

)

 

 

(74,101

)

Sales and maturities of marketable securities

 

 

91,081

 

 

 

69,456

 

Initial cash payment for tax credit investment

 

 

 

 

 

(20,000

)

Net cash used in investing activities

 

 

(45,809

)

 

 

(57,549

)

Cash flows from financing activities:

 

 

 

 

 

 

Proceeds from the exercise of stock options

 

 

475

 

 

 

 

Share repurchases related to taxes for share-based awards

 

 

(14,445

)

 

 

(7,850

)

Tax credit investment liability payments

 

 

(1,341

)

 

 

(468

)

Net cash used in financing activities

 

 

(15,311

)

 

 

(8,318

)

Effect of exchange rate changes on cash and cash equivalents

 

 

(1,757

)

 

 

(15

)

Decrease in cash and cash equivalents

 

 

(4,326

)

 

 

(29,605

)

Cash and cash equivalents at beginning of period

 

 

178,321

 

 

 

201,260

 

Cash and cash equivalents at end of period

 

$

173,995

 

 

$

171,655

 

 

 

 

 


 

Important Information Regarding Non-GAAP Financial Measures

In addition to evaluating the financial condition and results of our operations in accordance with U.S. generally accepted accounting principles (“GAAP”), from time to time our management evaluates and analyzes results and any impact on the Company of certain events outside of normal, or “core,” business and operations, by considering adjusted financial measures not prepared in accordance with GAAP. Examples of items that we consider non-core include store impairment and lease abandonment charges. In order to improve the transparency of our disclosures, provide a meaningful presentation of results from our core business operations and improve period-over-period comparability, we have included certain adjusted financial measures for fiscal 2025 that exclude the impact of these non-core business items.

We believe these adjusted financial measures are important indicators of our recurring results of operations because they exclude items that may not be indicative of, or are unrelated to, our underlying results of operations and provide a useful baseline for analyzing trends in our underlying business. Management uses adjusted financial measures for planning, forecasting and evaluating business and financial performance.

Non-GAAP financial measures should be viewed as supplementing, and not as an alternative or substitute for, the Company’s financial results prepared in accordance with GAAP. Certain of the items that may be excluded or included in non-GAAP financial measures may be significant items that could impact the Company’s financial position, results of operations or cash flows and should therefore be considered in assessing the Company’s actual and future financial condition and performance. These adjusted financial measures are not consistent with GAAP and may not be calculated the same as similarly titled measures used by other companies.

 

___________________________________________________________________________________________________

 

 


 

URBAN OUTFITTERS, INC.

 

Reconciliation of Non-GAAP Financial Measures

 

(amounts in thousands, except per share data)

 

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Total Company Adjusted Gross Profit:

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

April 30,

 

 

2024

 

 

2023

 

 

$'s

 

% of Net Sales

 

 

$'s

 

% of Net Sales

 

 

 

 

 

 

 

 

 

 

 

Gross profit (GAAP)

$

408,385

 

 

34.0

%

 

$

371,231

 

 

33.3

%

Adjustments:

 

 

 

 

 

 

 

 

 

Store impairment and lease abandonment charges (a)

 

4,601

 

 

 

 

 

 

 

 

Adjusted gross profit (Non-GAAP)

$

412,986

 

 

34.4

%

 

$

371,231

 

 

33.3

%

 

Reconciliation of Total Company Adjusted Income from Operations:

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

April 30,

 

 

2024

 

 

2023

 

 

$'s

 

% of Net Sales

 

 

$'s

 

% of Net Sales

 

 

 

 

 

 

 

 

 

 

 

Income from operations (GAAP)

$

74,624

 

 

6.2

%

 

$

71,383

 

 

6.4

%

Adjustments:

 

 

 

 

 

 

 

 

 

Store impairment and lease abandonment charges (a)

 

4,601

 

 

 

 

 

 

 

 

Adjusted income from operations (Non-GAAP)

$

79,225

 

 

6.6

%

 

$

71,383

 

 

6.4

%

 

 

 


 

URBAN OUTFITTERS, INC.

Reconciliation of Non-GAAP Financial Measures

(amounts in thousands, except per share data)

(unaudited)

 

 

 

 

 

 

 

 

Reconciliation of Total Company Adjusted Income Tax Expense and Adjusted Effective Tax Rate:

 

Three Months Ended

 

April 30,

 

2024

 

2023

 

$'s

 

 

 

$'s

 

 

 

 

 

 

 

 

 

 

Income before income taxes (GAAP)

$

80,870

 

 

 

$

72,402

 

 

Adjustments:

 

 

 

 

 

 

 

Store impairment and lease abandonment charges (a)

 

4,601

 

 

 

 

 

 

Adjusted income before income taxes (Non-GAAP)

$

85,471

 

 

 

$

72,402

 

 

 

 

 

 

 

 

 

 

Income tax expense (GAAP)

$

19,105

 

 

 

$

19,585

 

 

Adjustments:

 

 

 

 

 

 

 

Provision for income taxes on adjustments (b)

 

876

 

 

 

 

 

 

Adjusted income tax expense (Non-GAAP)

$

19,981

 

 

 

$

19,585

 

 

 

 

 

 

 

 

 

 

Effective income tax rate (GAAP)

 

23.6

%

 

 

 

27.1

%

 

Adjustments

 

(0.2

%)

 

 

 

 

 

Adjusted effective income tax rate (Non-GAAP)

 

23.4

%

 

 

 

27.1

%

 

 

Reconciliation of Total Company Adjusted Net Income and Adjusted Diluted EPS:

 

 

Three Months Ended

 

 

April 30,

 

 

2024

 

 

2023

 

 

$'s

 

% of Net Sales

 

 

$'s

 

% of Net Sales

 

 

 

 

 

 

 

 

 

 

 

Net income (GAAP)

$

61,765

 

 

5.1

%

 

$

52,817

 

 

4.7

%

Adjustments:

 

 

 

 

 

 

 

 

 

Store impairment and lease abandonment charges (a)

 

4,601

 

 

 

 

 

 

 

 

Provision for income taxes on adjustments (b)

 

(876

)

 

 

 

 

 

 

 

Adjusted net income (Non-GAAP)

$

65,490

 

 

5.5

%

 

$

52,817

 

 

4.7

%

 

 

 

 

 

 

 

 

 

 

Diluted EPS (GAAP)

$

0.65

 

 

 

 

$

0.56

 

 

 

Adjustments, net of tax

 

0.04

 

 

 

 

 

 

 

 

Adjusted diluted EPS (Non-GAAP)

$

0.69

 

 

 

 

$

0.56

 

 

 

 

 

 

 

 

 

 

 

 

 

(a) Store impairment charges relate to one retail location during the three months ended April 30, 2024. During the three months ended April 30, 2024, the Company also recorded lease abandonment charges for one retail location for which it has ceased operations but the lease has not been terminated.

 

 

 

 

 

 

 

 

 

 

 

(b) The income tax impact of non-GAAP adjustments is calculated using the estimated tax rate in effect for the respective non-GAAP adjustments.