Urban Outfitters, Inc. (NASDAQ:URBN), a portfolio of global
consumer brands comprised of Anthropologie, Bhldn, Free People,
Terrain and Urban Outfitters brands and our Food and Beverage
division, today announced net income of $64 million and $218
million for the three months and year ended January 31, 2017,
respectively. Earnings per diluted share were $0.55 and $1.86 for
the three months and year ended January 31, 2017, respectively.
Total Company net sales for the fourth quarter
of fiscal 2017 increased 2% over the same quarter last year to a
record $1.03 billion. Comparable Retail segment net sales, which
include our comparable direct-to-consumer channel, were flat. By
brand, comparable Retail segment net sales increased 2.0% at Urban
Outfitters and 1.2% at Free People, but decreased 2.9% at the
Anthropologie Group. Comparable Retail segment sales were driven by
strong, double-digit growth in the direct-to-consumer channel,
which were offset by negative retail store comparable net sales.
Wholesale segment net sales decreased by 1%, as the prior year
period benefitted from late shipments of third quarter
bookings.
For the year ended January 31, 2017, total
company net sales increased to $3.5 billion or 3% over the prior
year. Comparable Retail segment net sales increased 1%. Wholesale
segment net sales increased 11%.
“We are pleased to announce record fourth
quarter and full year sales driven mostly by the continued success
in the direct-to-consumer channel,” said Richard A. Hayne, Chief
Executive Officer. “As we enter a new year, we will continue to
shift our efforts and spend into our fastest growing channel,”
finished Mr. Hayne.
Net sales by brand and segment for the three and
twelve month periods were as follows:
|
|
|
|
|
Three Months Ended |
|
Twelve Months Ended |
|
January 31, |
|
January 31, |
Net sales by
brand |
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
Urban Outfitters |
$ |
413,799 |
|
$ |
415,448 |
|
$ |
1,414,996 |
|
$ |
1,392,040 |
Anthropologie
Group |
|
423,985 |
|
|
417,723 |
|
|
1,445,395 |
|
|
1,437,141 |
Free People |
|
186,346 |
|
|
178,482 |
|
|
662,726 |
|
|
609,552 |
Food and Beverage |
|
6,028 |
|
|
1,753 |
|
|
22,677 |
|
|
6,401 |
Total Company |
$ |
1,030,158 |
|
$ |
1,013,406 |
|
$ |
3,545,794 |
|
$ |
3,445,134 |
|
|
|
|
|
|
|
|
Net sales by
segment |
|
|
|
|
|
|
|
Retail Segment |
$ |
955,909 |
|
$ |
938,681 |
|
$ |
3,256,890 |
|
$ |
3,184,955 |
Wholesale Segment |
|
74,249 |
|
|
74,725 |
|
|
288,904 |
|
|
260,179 |
Total Company |
$ |
1,030,158 |
|
$ |
1,013,406 |
|
$ |
3,545,794 |
|
$ |
3,445,134 |
|
|
|
|
|
|
|
|
|
|
|
|
For the three months ended January 31, 2017, the gross profit
rate decreased by 142 basis points versus the prior year’s
comparable period. The decline in gross profit rate was driven
by deleverage in customer delivery and logistics expense rates
primarily due to the increased penetration of the
direct-to-consumer channel and deleverage in maintained margins due
to lower initial mark-up and higher markdowns at both the
Anthropologie and Urban Outfitters brands.
Store occupancy as a rate of sales was flat for
the quarter, which includes approximately $4 million of store
impairment charges in the current year and approximately $7 million
of store impairment charges in the prior year. The current year
store impairment charges related to one Urban Outfitters store and
two Free People stores, all located in the United States.
For the year ended January 31, 2017, the gross
profit rate increased by 21 basis points versus the prior year’s
comparable period. The increase in gross profit rate was primarily
driven by improvement in the Urban Outfitters brand maintained
margins due to lower merchandise markdowns compared to the prior
year. This increase was partially offset by a lower gross profit
rate at the Free People brand, which was primarily driven by lower
maintained margins due to higher merchandise markdowns, and total
Company deleverage in customer delivery and logistics expense
primarily related to the increased penetration of our
direct-to-consumer channel.
As of January 31, 2017, total inventory
increased by $8 million, or 3%, on a year-over-year basis. The
increase in inventory relates to inventory to support non-comp
stores. On a year-over-year basis, total Company selling square
footage increased 5%. Comparable Retail segment inventory
decreased 2% at cost.
For the three months and year ended January 31,
2017, selling, general and administrative expenses, expressed as a
percentage of net sales, increased by 40 basis points and 93 basis
points when compared to the prior year’s comparable periods,
respectively. The deleverage in the quarter related to an increase
in direct store expenses. These expenses primarily relate to
recently opened expanded format Anthropologie and Free People
stores. The deleverage for the full year ended January 31, 2017,
was primarily due to direct store expenses to support our square
footage growth and expanded format stores and an increase in direct
marketing expenses to support our direct-to-consumer channel
growth.
The Company’s effective tax rate for the fourth
quarter of fiscal 2017 was 34.9% compared to 36.9% in the prior
year period. The decrease in the fourth quarter tax rate was due to
a change in the ratio of certain foreign profits to global taxable
profits. The effective tax rate for the year ended January 31, 2017
was 35.5% compared to 35.9% in the prior year 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 1.3 million common
shares for approximately $46 million during the year ended January
31, 2017 and repurchased and retired an additional 12.7 million
common shares for approximately $382 million during fiscal 2016. As
of January 31, 2017, 6.0 million common shares are remaining under
this authorization.
During the year ended January 31, 2017, the
Company opened a total of 29 new stores including: 15 Free People
stores, 10 Anthropologie Group stores and 4 Urban Outfitters
stores; and closed 7 stores including: 3 Anthropologie Group
stores, 2 Free People stores and 2 Urban Outfitters stores. During
the year ended January 31, 2017, the Company opened 2 net new
restaurants and acquired 6 Vetri Family restaurants, which are
included in the Food and Beverage division.
Urban Outfitters, Inc. is a portfolio of global
consumer brands which offers a variety of lifestyle merchandise and
consumer products to highly defined customer niches through 242
Urban Outfitters stores in the United States, Canada, and Europe,
and websites; 225 Anthropologie Group stores in the United States,
Canada and Europe, catalogs and websites; 127 Free People stores in
the United States and Canada, catalogs and websites; Free People
wholesale, which sells its product to approximately 1,900 specialty
stores and select department stores worldwide; and 12 Food and
Beverage restaurants, as of January 31, 2017.
A conference call will be held today to discuss fourth quarter
results and will be webcast at 5:00 pm. ET at:
http://edge.media-server.com/m/p/kcrb8id8
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 EndedJanuary
31, |
|
Twelve Months
EndedJanuary 31, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
Net sales |
|
$ |
1,030,158 |
|
|
$ |
1,013,406 |
|
|
$ |
3,545,794 |
|
|
$ |
3,445,134 |
|
Cost of sales |
|
|
689,844 |
|
|
|
664,218 |
|
|
|
2,301,181 |
|
|
|
2,243,232 |
|
Gross
profit |
|
|
340,314 |
|
|
|
349,188 |
|
|
|
1,244,613 |
|
|
|
1,201,902 |
|
Selling, general, and
administrative expenses |
|
|
240,787 |
|
|
|
232,739 |
|
|
|
906,086 |
|
|
|
848,323 |
|
Income from
operations |
|
|
99,527 |
|
|
|
116,449 |
|
|
|
338,527 |
|
|
|
353,579 |
|
Other expense, net |
|
|
(776 |
) |
|
|
(894 |
) |
|
|
(428 |
) |
|
|
(3,548 |
) |
Income before
income taxes |
|
|
98,751 |
|
|
|
115,555 |
|
|
|
338,099 |
|
|
|
350,031 |
|
Income tax expense |
|
|
34,463 |
|
|
|
42,677 |
|
|
|
119,979 |
|
|
|
125,542 |
|
Net income |
|
$ |
64,288 |
|
|
$ |
72,878 |
|
|
$ |
218,120 |
|
|
$ |
224,489 |
|
|
|
|
|
|
|
|
|
|
Net income per common
share: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.55 |
|
|
$ |
0.61 |
|
|
$ |
1.87 |
|
|
$ |
1.79 |
|
Diluted |
|
$ |
0.55 |
|
|
$ |
0.61 |
|
|
$ |
1.86 |
|
|
$ |
1.78 |
|
|
|
|
|
|
|
|
|
|
Weighted-average common
shares and |
|
|
|
|
|
|
|
|
common share
equivalents outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
116,233,694 |
|
|
|
118,568,962 |
|
|
|
116,873,023 |
|
|
|
125,232,499 |
|
Diluted |
|
|
116,810,034 |
|
|
|
118,606,002 |
|
|
|
117,291,117 |
|
|
|
126,013,414 |
|
|
|
|
|
|
|
|
|
|
AS A PERCENT OF NET
SALES |
|
|
|
|
|
|
|
|
Net sales |
|
|
100.0 |
% |
|
|
100.0 |
% |
|
|
100.0 |
% |
|
|
100.0 |
% |
Cost of sales |
|
|
67.0 |
% |
|
|
65.5 |
% |
|
|
64.9 |
% |
|
|
65.1 |
% |
Gross
profit |
|
|
33.0 |
% |
|
|
34.5 |
% |
|
|
35.1 |
% |
|
|
34.9 |
% |
Selling, general, and
administrative expenses |
|
|
23.3 |
% |
|
|
23.0 |
% |
|
|
25.6 |
% |
|
|
24.6 |
% |
Income from
operations |
|
|
9.7 |
% |
|
|
11.5 |
% |
|
|
9.5 |
% |
|
|
10.3 |
% |
Other expense, net |
|
|
(0.1 |
%) |
|
|
(0.1 |
%) |
|
|
(0.0 |
%) |
|
|
(0.1 |
%) |
Income before
income taxes |
|
|
9.6 |
% |
|
|
11.4 |
% |
|
|
9.5 |
% |
|
|
10.2 |
% |
Income tax expense |
|
|
3.4 |
% |
|
|
4.2 |
% |
|
|
3.3 |
% |
|
|
3.7 |
% |
Net income |
|
|
6.2 |
% |
|
|
7.2 |
% |
|
|
6.2 |
% |
|
|
6.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
URBAN OUTFITTERS, INC. |
|
Condensed Consolidated Balance
Sheets |
|
(in thousands, except share and per share
data)(unaudited) |
|
|
|
|
|
January 31,2017 |
|
January 31,2016 |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash
equivalents |
|
$ |
248,140 |
|
|
$ |
265,276 |
|
|
Marketable
securities |
|
|
111,067 |
|
|
|
61,061 |
|
|
Accounts
receivable, net of allowance for doubtful accounts of
$588 and $664, respectively |
|
|
54,505 |
|
|
|
75,723 |
|
|
Inventory |
|
|
338,590 |
|
|
|
330,223 |
|
|
Prepaid expenses
and other current assets |
|
|
129,095 |
|
|
|
102,078 |
|
|
Total current assets |
|
|
881,397 |
|
|
|
834,361 |
|
|
Property and equipment,
net |
|
|
867,786 |
|
|
|
863,137 |
|
|
Marketable
securities |
|
|
44,288 |
|
|
|
36,600 |
|
|
Deferred income taxes
and other assets |
|
|
109,166 |
|
|
|
99,203 |
|
|
Total Assets |
|
$ |
1,902,637 |
|
|
$ |
1,833,301 |
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts
payable |
|
$ |
119,537 |
|
|
$ |
118,035 |
|
|
Accrued
expenses, accrued compensation and other current liabilities |
|
|
233,391 |
|
|
|
211,196 |
|
|
Total current liabilities |
|
|
352,928 |
|
|
|
329,231 |
|
|
Long-term debt |
|
|
- |
|
|
|
150,000 |
|
|
Deferred rent and other
liabilities |
|
|
236,625 |
|
|
|
216,843 |
|
|
Total Liabilities |
|
|
589,553 |
|
|
|
696,074 |
|
|
|
|
|
|
|
|
Shareholders’
equity: |
|
|
|
|
|
Preferred
shares; $.0001 par value, 10,000,000 shares authorized,
none issued |
|
|
- |
|
|
|
- |
|
|
Common shares;
$.0001 par value, 200,000,000 shares authorized,
116,233,781 and 117,321,120 shares issued and outstanding,
respectively |
|
|
12 |
|
|
|
12 |
|
|
Additional
paid-in capital |
|
|
- |
|
|
|
- |
|
|
Retained
earnings |
|
|
1,347,141 |
|
|
|
1,160,666 |
|
|
Accumulated
other comprehensive loss |
|
|
(34,069 |
) |
|
|
(23,451 |
) |
|
Total Shareholders’ Equity |
|
|
1,313,084 |
|
|
|
1,137,227 |
|
|
Total Liabilities and Shareholders’ Equity |
|
$ |
1,902,637 |
|
|
$ |
1,833,301 |
|
|
|
|
|
|
|
|
|
|
|
|
Contact:
Oona McCulloughDirector of Investor Relations(215) 454-4806
Urban Outfitters (NASDAQ:URBN)
Historical Stock Chart
From Aug 2024 to Sep 2024
Urban Outfitters (NASDAQ:URBN)
Historical Stock Chart
From Sep 2023 to Sep 2024