Urban Outfitters Results Miss Estimates

(RTTNews) - Apparel and accessories retailer Urban Outfitters, Inc. (URBN) said Monday after the markets closed that its first quarter profit fell 13% from last year, as higher costs and expenses more than offset an 8% increase in sales.

The company's quarterly earnings per share also came in below analysts' expectations as did its quarterly sales.

Urban Outfitters shares are currently losing 16.26% in after hours trading after closing the day's regular trading session at $40.72, up $1.13 or 2.85%. The shares trade in a 52-week range of $27.89 to $47.25.

The company operates 238 Urban Outfitters stores, 208 Anthropologie stores, 106 Free People stores and 2 Terrain garden centers. The company's competitors include Abercrombie & Fitch Co. (ANF) and Gap, Inc. (GPS).

For the first quarter ended April 30, 2015, the Philadelphia, Pennsylvania-based company reported net income of $32.8 million or $0.25 per share, compared to $37.5 million or $0.26 per share for the year-ago quarter.

On average, 36 analysts polled by Thomson Reuters expected the company to earn $0.30 per share for the first quarter.

Gross margin for the fourth quarter shrank to 33.3% from 34.8% a year ago, mainly due to lower initial margins at the Urban Outfitters Brand and higher delivery and fulfillment expense across the entire company.

Operating margin for the quarter narrowed to 7.2% from 8.7% last year.

Net sales for the first quarter rose 8% to $739.01 million from $686.31 million in the same quarter last year. Thirty-four analysts had a consensus revenue estimate of $758.25 million for the first quarter.

Comparable Retail segment net sales, which include the company's comparable direct-to-consumer channel, increased 4%. Comparable Retail segment net sales increased 17% at Free People, 5% at Urban Outfitters and 1% at the Anthropologie Group. Wholesale segment net sales rose 18%.