Urban Outfitters (URBN) Posts Holiday Results, Sales Up 2.3%
Urban Outfitters, Inc. URBN reported higher sales for the holiday period. URBN remains committed to driving overall growth, thanks to its robust business strategies and sound fundamentals. Management has been strengthening its direct-to-consumer business, enhancing productivity across the existing channels and optimizing inventory levels. Let’s delve deeper.
Total net sales for the two months ended Dec 31, 2022, jumped 2.3% from the level recorded in the two months ended Dec 31, 2021. The total Retail segment net sales also grew 1%, with comparable Retail segment net sales rising 2%, partly offset by a 1% foreign currency translation impact. Growth in the Retail segment comparable net sales was backed by a low single-digit increase in digital channel sales and a low single-digit rise in retail store sales.
By brand, comparable Retail segment net sales rose 15% at Free People and 7% at the Anthropologie Group while dipping 10% at Urban Outfitters. Further, the Wholesale segment’s net sales declined 22% on lower Free People Group wholesale sales stemming from decreased department store sales. Nuuly segment sales surged a whopping 150% year over year on a 153%-increase in its subscribers in the two months ended Dec 31, 2022.
During the 11 months that ended Dec 31, 2022, total net sales jumped 5.1% from the level recorded in the eleven months that ended Dec 31, 2021. Also, comparable Retail segment net sales climbed 4%, buoyed by high single-digit growth in retail store sales on higher store traffic and a low single-digit rise in digital channel sales.
Wholesale segment net sales tumbled 3% in the eleven-month period, mainly driven by lower Free People Group wholesale sales. This was partly offset by higher sales to specialty accounts. Nuuly segment sales soared 176% on a 187%-increase in the subscribers during the eleven months ended Dec 31, 2022.
Urban Outfitters’ strategic growth initiative FP Movement and store-growth endeavors are yielding results. Regarding its store-related endeavors, URBN inaugurated 33 retail stores in the eleven months that ended Dec 31, 2022. These include 19 Free People Group stores consisting of 7 FP Movement outlets, 7 Urban Outfitters stores, 6 Anthropologie Group stores and 1 Menus & Venues restaurant. In the aforementioned period, management shuttered 7 retail locations including 3 Urban Outfitters stores, 3 Anthropologie Group stores and 1 Free People Group store. During the eleven months that ended Dec 31, 2022, 4 Urban Outfitters franchisee-owned stores and 1 Anthropologie Group franchisee-owned store were introduced.
As of Dec 31, 2022, Urban Outfitters operated 265 Urban Outfitters stores in the United States, Canada and Europe and websites; 241 Anthropologie Group outlets in the United States, Canada and Europe, catalogs and websites; 191 Free People locations in the United States, Canada and Europe, catalogs and websites, 11 Menus & Venues restaurants, 6 Urban Outfitters franchisee-owned stores and 2 Anthropologie Group franchisee-owned stores.
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This current Zacks Rank #2 (Buy) stock has rallied 29.5% in the past six months, outperforming the industry’s 15.6% growth.
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