Urban Outfitters (URBN) Posts Flat Holiday Season Sales
Urban Outfitters, Inc. URBN, a lifestyle specialty retailer, reported flat net sales for the combined November/December period of 2015. Comparable retail segment net sales, including the comparable direct-to-consumer channel, fell 2%. Comparable retail segment net sales of this Zacks Rank #4 (Sell) company rose 2% at Free People, but declined 2% at both Urban Outfitters and Anthropologie Group.
On the other hand, wholesale segment net sales surged 40%, partly on account of delayed shipments from the third quarter into the final quarter. Management pointed at sturdy direct-to-consumer growth at all the company’s brands during the holiday season. However, this was offset by sluggish store sales resulting from a fall in store traffic.
For the 11-month period ended Dec 31, 2015, Urban Outfitters registered year-over-year net sales growth of 4%. Comparable retail segment net sales jumped 2%, while wholesale segment net sales climbed 15%.
During the abovementioned time frame, Urban Outfitters opened a total of 29 new outlets – 13 Anthropologie stores, 12 Free People stores, and 4 Urban Outfitters stores. The company also shuttered 2 Urban Outfitters stores and 1 Free People store.
The holiday season was a tough one for some retailers. These companies felt the pinch of declining customer traffic at stores and malls, as online stores stole the limelight. Moreover, retailers were forced to offer promotions as buyers were keen on availing discounts. This weighed on retailers’ pockets as profits declined. The Buckle, Inc. BKE, Zumiez, Inc. ZUMZ and The Gap, Inc. GPS recorded comparable sales decline of 5.4%, 8.9% and 5%, respectively, during the month of December.
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