US: Urban Outfitters cautions on Q1 despite earnings growth
- Q4 net earnings up 7.5%
- Sales climb 6%
- Cautions on Q1 performance
Lifestyle retailer Urban Outfitters has cautioned on its current quarter, despite booking an increase in fourth-quarter earnings.
The company behind the Anthropologie and Free People brands recorded earnings of US$88.7m in the three months to the end of January, an increase of 7.5% on earnings of $82.5m last year.
Total net sales were up 6% over the same quarter last year to a "record" $906m. Comparable retail segment sales edged up 1%.
Comparable sales increased 20% at Free People and 10% at Anthropologie. However, comparable sales at the group's Urban Outfitters chain dropped 9% as poor weather conditions hit traffic numbers.
CEO Richard Hayne said "continued challenges" facing the Urban Outfitters brand means the company remains "very cautious" about its first-quarter performance.
The company's share price was down 0.13% to $37.51 in after hours trading yesterday.
FBR & Co analyst Susan Anderson said weather and product issues are likely to continue to weigh on the Urban Outfitters segment in the first quarter.
However, she added: "We believe Anthro and Free People continue to post positive comps (likely +8% and +18%, respectively). We think an Urban Outfitters fix is a late-2014/2015 story, but management is taking the right steps now to enact a turnaround (restructuring, elevating the brand to focus on its core 18-28 demographic, increasing quality).
"Although Urban Outfitters will likely weigh on results near term, we continue to believe URBN offers a compelling long-term value proposition with growth via FP, e-commerce, international, differentiated product, strong omni-channel capabilities, and strong margins."
The Intimate Apparel market in the US comprises of intimate apparel for both men and women. Intimate apparel products include underwear, bra, panty, sleepwear, daywear, and shapewear....
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