Driven by strong performances at its Anthropologie and Free People brands, NASDAQ-listed Urban Outfitters, Inc., a garment retailer was able to post record sales in the fiscal quarter ending July 31, 2014.
Net sales for the second quarter of fiscal 2015 rose to a record $811 million or 7% over the same quarter, last year. Comparable retail net sales, which include its direct-to-consumer channel, were flat.
Comparable retail segment net sales increased 21% at Free People and 6% at the Anthropologie Group and decreased 10% at Urban Outfitters, while wholesale segment net sales rose 36%, Urban Outfitters said in a press release.
For the three months ended July 31, 2014, gross profit rate declined by 194 basis points versus the prior year's comparable period. The retailer said the decline in gross profit rate was primarily driven by underperformance at the Urban Outfitters brand.
Urban Outfitters reported net income of $68 million and earnings per diluted share of $0.49 in the second quarter of 2015.
As of July 31, 2014, total inventories increased by $15 million or 4% year-on-year. Urban Outfitters attributed the growth in inventories to the acquisition of inventory to stock new and non-comparable stores.
For the three months ended July 31, 2014, selling, general and administrative (SG&A) expenses, expressed as a percentage of net sales, increased by 83 basis points, compared to the prior year's comparable period.
The increase in SG&A expense was primarily due to increased marketing and technology expenses which drove higher direct-to-consumer traffic, Urban Outfitters said.
The Company's effective tax rate for the second quarter of fiscal 2015 was 35.5% compared to 36.1% in the prior year's comparable period.
"We are pleased to announce record second quarter sales driven by strong performances at our Anthropologie and Free People brands," CEO Richard Hayne said.
"This achievement is a testament to the strength and validity of our model and to the ability of our talented teams to create powerful lifestyle brands, through compelling product, imagery and experiences," he added.
During the second quarter of fiscal 2015, Urban Outfitters repurchased and retired 3.7 million common shares for approximately $126 million, leaving 6.3 million shares available for repurchase under the current authorization.
