PHILADELPHIA, PA, August 17, 2015 -
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 $67 million and $100 million for the three and six months
ended July 31, 2015, respectively. Earnings per diluted share
were $0.52 and $0.76 for the three and six months ended July 31,
2015, respectively.
Total Company net sales for the second quarter of
fiscal 2016 increased 7% over the same quarter last year to a
record $867 million. Comparable Retail segment net sales, which
include our comparable direct-to-consumer channel, increased 4%.
Comparable Retail segment net sales increased 14% at Free People,
4% at Urban Outfitters and 2% at the Anthropologie Group. Wholesale
segment net sales rose 21%.
"We are pleased to announce record sales for the
second quarter driven by positive retail segment comp growth at
each brand," said Richard A. Hayne, Chief Executive Officer.
"Without question, the brands' strong execution of our long-term
strategy helped fuel that sales growth and laid the groundwork for
future increases, as well," finished Mr. Hayne.
Net sales by brand and segment for the three and
six month periods were as follows:
|
Three Months
Ended |
|
Six Months
Ended |
|
July 31, |
|
July 31, |
Net sales by brand |
2015 |
|
2014 |
|
2015 |
|
2014 |
Urban
Outfitters |
$ 342,207 |
|
$ 328,632 |
|
$ 637,882 |
|
$ 606,288 |
Anthropologie Group1 |
370,672 |
|
354,316 |
|
682,048 |
|
654,299 |
Free
People |
154,581 |
|
128,305 |
|
286,540 |
|
236,976 |
Total
Company |
$ 867,460 |
|
$ 811,253 |
|
$ 1,606,470 |
|
$ 1,497,563 |
|
|
|
|
|
|
|
|
Net sales by segment |
|
|
|
|
|
|
|
Retail
Segment |
$ 795,740 |
|
$ 752,116 |
|
$ 1,480,749 |
|
$ 1,392,546 |
Wholesale
Segment |
71,720 |
|
59,137 |
|
125,721 |
|
105,017 |
Total
Company |
$ 867,460 |
|
$ 811,253 |
|
$ 1,606,470 |
|
$ 1,497,563 |
1Anthropologie
Group consists of the Anthropologie, Bhldn and Terrain brands
For the three and six months ended
July 31, 2015, the gross profit rate declined by 71 basis points
and 104 basis points versus the prior year's comparable periods,
respectively. The decline in gross profit rate was primarily
driven by higher delivery and fulfillment center expenses largely
related to the increase in direct-to-consumer sales penetration as
well as incremental costs associated with the transition of our
South Carolina fulfillment center to Gap, Pennsylvania.
As of July 31, 2015, total
inventories increased by $22 million, or 6%, 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 decreased 2% at cost while
decreasing 7% in units.
For the three and six months ended July 31, 2015, selling, general
and administrative expenses, expressed as a percentage of net
sales, increased by 29 basis points and 22 basis points compared to
the prior year's comparable periods, respectively. The increase in
both periods was primarily due to increased marketing and
technology expenses which drove higher direct-to-consumer
traffic.
The Company's effective tax rate for the second
quarter of fiscal 2016 was 35.2% compared to 35.5% in the prior
year's comparable period.
On February 23, 2015, the Company's Board of Directors
authorized the repurchase of 20 million common shares under a share
repurchase program. Under this authorization, the Company
repurchased and subsequently retired a total of 4.8 million common
shares for approximately $170.8 million during the six months ended
July 31, 2015.
On May 27, 2014, the Company's Board of Directors authorized
the repurchase of 10 million common shares under a share repurchase
program. During the six months ended July 31, 2015, the Company
repurchased and subsequently retired 2.3 million shares at a total
cost of $82.8 million which completed this authorization. The
Company repurchased and subsequently retired 7.7 million common
shares at a total cost of $258.2 million during fiscal 2015.
On July 1, 2015, the Company entered into a five-year $400 million
asset-based revolving credit facility with a group of lenders, with
JPMorgan Chase Bank N.A. as administrative agent. The new credit
facility replaced the Company's existing $175 million line of
credit facility with Wells Fargo Bank, National Association, which
was set to expire in March 2019, and is secured by the Company's
eligible inventory and accounts receivable. As of July 31, 2015,
borrowings under the new revolving credit facility totaled
approximately $115 million. All borrowings under the revolving
credit facilities were used to fund the repurchase of common shares
of the Company.
During the six months ended July 31, 2015, the Company opened a
total of 13 new stores including: 7 Free People stores, 4
Anthropologie Group stores and 2 Urban Outfitters stores. The
Company closed 3 stores during the six months ended July 31, 2015,
2 Urban Outfitters stores and 1 Free People store.
Urban Outfitters, Inc. is an innovative specialty retail company
which offers a variety of lifestyle merchandise to highly defined
customer niches through 238 Urban Outfitters stores in the United
States, Canada, and Europe, catalogs and websites; 210
Anthropologie Group stores in the United States, Canada and Europe,
catalogs and websites; 108 Free People stores in the United States
and Canada, catalogs and websites; and Free People wholesale, which
sells its product to approximately 1,600 specialty stores and
select department stores worldwide; as of July 31, 2015.
A conference call will be held today to discuss
second quarter results and will be webcast at 5:00 pm. ET at:
http://edge.media-server.com/m/p/hvn6tkkj/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," "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 a worldwide
political and economic 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, failure of our manufacturers to comply with our
social compliance program, 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 |
|
Six Months
Ended |
|
|
July
31, |
|
July
31, |
|
|
2015 |
|
2014 |
|
2015 |
|
2014 |
|
|
|
|
|
|
|
|
|
Net
sales |
$ 867,460 |
|
$ 811,253 |
|
$ 1,606,470 |
|
$ 1,497,563 |
Cost
of sales |
549,355 |
|
507,995 |
|
1,041,944 |
|
955,794 |
Gross profit |
318,105 |
|
303,258 |
|
564,526 |
|
541,769 |
Selling, general and administrative expenses |
214,354 |
|
198,141 |
|
407,721 |
|
376,831 |
Income from operations |
103,751 |
|
105,117 |
|
156,805 |
|
164,938 |
Other
expense, net |
(596) |
|
(523) |
|
(2,717) |
|
(867) |
Income before income taxes |
103,155 |
|
104,594 |
|
154,088 |
|
164,071 |
Income
tax expense |
36,314 |
|
37,085 |
|
54,471 |
|
59,084 |
Net income |
$ 66,841 |
|
$ 67,509 |
|
$ 99,617 |
|
$ 104,987 |
|
|
|
|
|
|
|
|
Net
income per common share: |
|
|
|
|
|
|
|
Basic |
$ 0.52 |
|
$ 0.49 |
|
$ 0.77 |
|
$ 0.75 |
Diluted |
$ 0.52 |
|
$ 0.49 |
|
$ 0.76 |
|
$ 0.74 |
|
|
|
|
|
|
|
|
Weighted average common shares and common |
|
|
|
|
|
|
|
share equivalents outstanding: |
|
|
|
|
|
|
|
Basic |
127,910,026 |
|
136,453,663 |
|
129,529,108 |
|
140,201,489 |
Diluted |
129,080,594 |
|
138,177,110 |
|
130,931,093 |
|
141,978,651 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AS A
PERCENT OF NET SALES |
|
|
|
|
|
|
|
Net
sales |
100.0% |
|
100.0% |
|
100.0% |
|
100.0% |
Cost
of sales |
63.3% |
|
62.6% |
|
64.9% |
|
63.8% |
Gross profit |
36.7% |
|
37.4% |
|
35.1% |
|
36.2% |
Selling, general and administrative expenses |
24.7% |
|
24.4% |
|
25.3% |
|
25.2% |
Income from operations |
12.0% |
|
13.0% |
|
9.8% |
|
11.0% |
Other
expense, net |
(0.1%) |
|
(0.1%) |
|
(0.2%) |
|
0.0% |
Income before income taxes |
11.9% |
|
12.9% |
|
9.6% |
|
11.0% |
Income
tax expense |
4.2% |
|
4.6% |
|
3.4% |
|
4.0% |
Net income |
7.7% |
|
8.3% |
|
6.2% |
|
7.0% |
URBAN OUTFITTERS,
INC.
Condensed Consolidated Balance
Sheets
(in thousands, except share and per share
data)
(unaudited)
|
|
|
|
|
July 31,
2015 |
|
January 31,
2015 |
|
July 31,
2014 |
ASSETS |
|
|
|
|
|
Current
assets: |
|
|
|
|
|
Cash and cash equivalents |
$
194,441 |
|
$ 154,558 |
|
$ 145,273 |
Marketable securities |
71,926 |
|
104,246 |
|
106,721 |
Accounts receivable, net of allowance for doubtful accounts |
|
|
|
|
|
of
$813, $850 and $1,038, respectively |
70,014 |
|
70,458 |
|
72,813 |
Inventories |
384,404 |
|
358,237 |
|
362,028 |
Prepaid expenses, deferred taxes and other current assets |
118,678 |
|
121,618 |
|
105,129 |
Total current assets |
839,463 |
|
809,117 |
|
791,964 |
|
|
|
|
|
|
Property
and equipment, net |
900,302 |
|
889,232 |
|
868,642 |
Marketable securities |
72,764 |
|
104,448 |
|
157,146 |
Deferred
income taxes and other assets |
94,804 |
|
85,944 |
|
86,394 |
Total Assets |
$ 1,907,333 |
|
$ 1,888,741 |
|
$ 1,904,146 |
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts payable |
$
134,673 |
|
$
156,090 |
|
$ 156,810 |
Accrued expenses, accrued compensation and other current
liabilities |
218,604 |
|
197,650 |
|
211,388 |
Total current liabilities |
353,277 |
|
353,740 |
|
368,198 |
Long-term
debt |
115,000 |
|
- |
|
- |
Deferred
rent and other liabilities |
207,808 |
|
207,032 |
|
199,891 |
Total Liabilities |
676,085 |
|
560,772 |
|
568,089 |
|
|
|
|
|
|
Shareholders' equity: |
|
|
|
|
|
Preferred shares; $.0001 par value, 10,000,000 shares authorized,
none issued |
- |
|
- |
|
- |
Common shares; $.0001 par value, 200,000,000 shares authorized,
125,126,008, |
|
|
|
|
|
130,502,864 and 134,057,393 issued and outstanding
respectively |
13 |
|
13 |
|
13 |
Additional paid-in-capital |
- |
|
- |
|
- |
Retained earnings |
1,241,227 |
1,343,383 |
|
1,333,658 |
Accumulated other comprehensive income (loss) |
(9,992) |
|
(15,427) |
|
2,386 |
Total Shareholders' Equity |
1,231,248 |
|
1,327,969 |
|
1,336,057 |
Total Liabilities and Shareholders' Equity |
$ 1,907,333 |
|
$ 1,888,741 |
|
$ 1,904,146 |
Contact:
Oona McCullough
Director of Investor Relations
(215) 454-4806
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Urban Outfitters via Globenewswire
HUG#1946155
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