Urban Outfitters posts 38% uptick in profits
Urban Outfitters, Inc. (URBN) announced net income of $76.7 million in the third quarter on Monday, a 38% year-over-year increase compared to the $55.7 million reported by the Philadelphia-based fashion retailer in the prior-year period.
For the third quarter ended October 31, 2020, the retailer’s earnings per diluted share were $0.78, compared to $0.56 in the same period in the previous year.
Quarterly net sales at the company decreased 1.8% to $969.6 million, compared to $987.5 million in the prior-year period. This slip in revenues reflected comparable retail segment sales that were flat compared to the same period in the previous year, partially offset by double-digit growth in the retailer’s digital channel.
Comparable retail segment net sales increased 4% in the company’s namesake Urban Outfitters chain and 17% at the Free People brand. However, the Anthropologie Group posted a 9% decrease, while the wholesale segment saw its net sales decline 24% year over.
As it attempts to deal with a downturn in sales related to the ongoing Covid-19 pandemic, URBN was able to reduce its selling, general and administrative expenses by $21.4 million, or 8.7% year over year, during the quarter.
“I am pleased to announce URBN delivered record Q3 earnings per share in spite of an incredibly difficult operating environment,” commented URBN CEO Richard A. Hayne in a release. “Our 38% increase in net profits was driven by strong product assortments combined with tight control of inventory and expenses.”
Year to date, URBN’s sales totaled $2.4 billion, decreasing 16.1% from $2.8 billion in the same period in the previous year. Net loss was $27.3 million, or $0.28 per diluted share, compared to net income of $148.6 million, or $1.47 per diluted share, in the first nine months last year.
Due to the continued uncertainty surrounding the Covid-19 pandemic, URBN has not provided financial guidance for the fourth quarter or full fiscal year.
The company currently operates some 630 stores across its Urban Outfitters, Anthropologie Group and Free People brands in the U.S., Canada and Europe. Free People and Urban Outfitters also wholesale sell their products through around 2,300 department and specialty stores worldwide.
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