Many retailers have been riding high on the consumer spending wave and Urban Outfitters Inc. is no exception.
The Philadelphia-based retailer, whose brands include its namesake chain, the Anthropologie Group and Free People, enjoyed record sales in the second quarter, pushing its shares up by more than 5 percent in after-hours trading.
Net sales came in at $992 million in the three months ending July 31, marking a jump of 13.7 percent over a year earlier and topping analysts polled by Reuters’ average estimate of $979.9 million. Net income, meanwhile, was $93 million and earnings per diluted share were 84 cents.
Comparable net sales increased 13 percent. Within that, Free People led the way, up 17 percent, while Urban Outfitters and the Anthropologie Group saw sales up 11 percent and 10 percent, respectively.
“Over the last six months I’ve spoken on these calls about the strengthening of the U.S. economy, growing consumer confidence, and a changing fashion silhouette. These factors have combined to create a brisk tailwind for fashion retailers. As they did in the first quarter our brand teams in Q2 took full advantage of this opportunity,” Richard A. Hayne, chief executive officer, told investors.
While Hayne refrained from commenting on the U.S.’s trade war with China’s possible effect on the company, chief financial officer Francis John Conforti said he anticipates “little, if any, impact” in the current year, but will follow future investments closely.
During the first half of the year, the company opened seven new locations, including three Free People stores, two Urban Outfitters stores and two Anthropologie stores. At the same time, it closed one Urban Outfitters store and one Anthropologie store. For the year as a whole, it plans to open 18 stores and close 13.
As a thank you for their hard work, Urban Outfitters Inc.’s non-bonus eligible staff will share a onetime $2.5 million payment.
Its earnings were released after the market closed, but its share price ended Tuesday up 0.48 percent at $47.74.