Urban Outfitters Q3 comparable store sales miss estimates

Total net sales for the third quarter at Urban Outfitters increased 1 percent over the same quarter last year to 825 million dollars. Comparable retail segment net sales, which include comparable direct-to-consumer channel, increased 1 percent.

“I am pleased we delivered sales, margin and profit growth in the third quarter despite weaker customer traffic,” said Richard A. Hayne, Chief Executive Officer, adding, “I believe the strong customer response to expanded category offerings at each brand bodes well for our future growth.”

Q3 results miss analyst's estimates

Comparable retail segment net sales increased 3 percent at Free People and 1 percent at Urban Outfitters, while the Anthropologie Group was flat. Wholesale segment net sales declined 5 percent due to shipment delays at its new distribution facility in Gap, Pennsylvania.

Urban Outfitters has announced net income of 52 million dollars and 152 million dollars for the three and nine months ended October 31, 2015, respectively. Earnings per diluted share were 0.42 dollar and 1.18 dollars for the three and nine months ended October 31, 2015, respectively.

For the three months, the gross profit rate increased by 11 basis points versus the prior year's comparable period. The increase in gross profit rate was primarily driven by almost 150 basis points of improvement in the company's maintained margin due to significant improvement in the Urban Outfitters brand markdown rate which was partially offset by lower maintained margins in the Anthropologie Group and Free People retail segments. For the nine months, the gross profit rate declined by 63 basis points versus the prior year's comparable period.

During the nine months ended October 31, 2015, the company opened 23 new stores including: 11 Free People stores, eight Anthropologie Group stores and four Urban Outfitters stores. The company closed two Urban Outfitters and one Free People store.