US retailer Urban Outfitters' sales up 2.2% in Q2 FY22

By brand, comparable retail segment net sales increased 8 per cent at the Free People Group and 7 per cent at the Anthropologie Group and decreased 9 per cent at Urban Outfitters. Wholesale segment net sales increased 1 per cent, driven by a 4 per cent increase in Free People Group wholesale sales, partially offset by a decline in Urban Outfitters wholesale sales. Nuuly segment net sales increased by $18.8 million, driven by a significant increase in the subscribers.

For the six months ended July 31, 2022, total company net sales increased 7.2 per cent compared to the same period last year. Total retail segment net sales increased 6 per cent, with comparable retail segment net sales increasing 5 per cent. The relative proportion of retail segment sales attributable to store and digital channels changed significantly due in large part to the temporary store closures and occupancy restrictions in the United States, Europe and Canada in the first half of the prior year due to the COVID-19 pandemic, the company said in a press release.

For the three months ended July 31, 2022, the gross profit rate decreased by 595 basis points compared to the prior year’s comparable period. Gross profit dollars decreased 13.9 per cent to $374.6 million. The decrease in gross profit rate and dollars was primarily due to higher markdowns at all three brands as compared to record low markdown rates in the comparable prior year quarter. Lower initial merchandise markups driven largely by higher inbound transportation expenses further contributed to the deleverage. Additionally, higher carrier fuel surcharges resulted in a deleverage in delivery expense.

“We are pleased to announce record Q2 sales fueled by strong ‘comps’ at the Anthropologie and Free People brands,” said Richard A Hayne, chief executive officer.

ALCHEMPro News Desk (RR)