Urban Outfitters Profit Jumps as Margins Widen

Monday, 19 Aug 2013 06:24 PM

 

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Teen apparel retailer Urban Outfitters Inc. said fewer discounts helped gross margins in the second quarter and reported a higher-than-expected profit.

Urban Outfitters, whose shares were up 6 percent in extended trading on Monday, has been faring better than rivals Abercrombie & Fitch Co. and Aeropostale Inc. due to its attractive pricing and fresher styles.

Analysts say the company's trendy and fashionable merchandise has helped it capture market share even in a weak consumer environment where mall traffic remains erratic and unpredictable.

Urban Outfitters reported gross margins of 39.3 percent in the quarter ended July, up from 37.6 percent a year earlier.

Net income rose to $76.4 million, or 51 cents per share, from $61.3 million, or 42 cents per share, a year earlier.

Revenue rose 12 percent to $758.5 million.

Analysts on an average were expecting second-quarter earnings of 48 cents per share on revenue of $768.1 million, according to Thomson Reuters I/B/E/S.

The Philadelphia-based company's shares closed at $39.92 on the Nasdaq on Monday. In afterhours trading, the shares jumped 6.2 percent to $42.40.

© 2014 Thomson/Reuters. All rights reserved.

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