Urban Outfitters is reviewing ‘all areas’ of its struggling namesake shops

Clothing retailer Urban Outfitters Inc. mentioned Tuesday it’s reviewing “all areas” of its struggling namesake shops, after yet one more quarter of falling same-store gross sales and what executives described as waning exuberance amongst buyers.

Those remarks got here throughout Urban Outfitters’
earnings convention name, after the corporate — which additionally runs girls’s clothes chains Anthropologie and Free People, in addition to Nuuly, a girls’s clothes rental and resale service — reported fourth-quarter outcomes that missed expectations.

Shares sank 10.2% after hours.

Chief Executive Dick Hayne mentioned on the decision that whereas the retailer’s clients stay upbeat total, “they’re not as exuberant as they were when first coming out of the pandemic.”

“They don’t have as many weddings and events to attend. They are less apt to move and have recently refurbished their living spaces,” Hayne mentioned. “So demand for categories like dress or footwear and home furnishings are trending softer.”

However, he mentioned shoppers had been in first rate monetary form, including: “They tend to be optimistic, want the latest fashion and are willing to spend some of those extra earnings to enjoy them.”

Urban Outfitters executives mentioned they consider the corporate might put up “low-single-digit” same-store gross sales progress throughout its enterprise for each the present first quarter and the complete fiscal 12 months forward — helped by Anthropologie and Free People, which are inclined to cater to wealthier clients who’re higher shielded from inflation. Wall Street analysts forecast 2.8% same-store gross sales progress for the 12 months.

However, the corporate mentioned first-quarter same-store gross sales for its namesake Urban Outfitters chain, particularly, would look loads just like the fourth quarter, once they fell 13.6%. They mentioned these gross sales would enhance over the course of the 12 months.

Urban Outfitters shops have struggled to remain fashionably related amongst youthful, much less prosperous clients, who’ve been hit by two years of upper costs for fundamentals. That inflation has damage demand for clothes throughout the business.

As a part of efforts to revitalize its enterprise, Shea Jensen — a veteran of department-store chain Nordstrom Inc.
— joined the corporate this month as president of its Urban Outfitters model for North America. During the decision, Hayne mentioned having that management in place is the core ingredient to the model’s turnaround.

Still, administration mentioned they’ve needed to reduce costs at Urban Outfitters greater than anticipated, to filter current clothes stockpiles.

“Markdowns were flat for the quarter versus last year, but were higher than planned in the month of January as Urban Outfitters needed to promote more aggressively than planned to clear through excess inventory,” Frank Conforti, the corporate’s chief working officer, mentioned on the decision.

For the fourth quarter, Urban Outfitters reported adjusted earnings per share of 69 cents, beneath FactSet analyst forecasts of 74 cents. Revenue rose 7.3% to a $1.486 billion, slightly below estimates for $1.499 billion.

As Anthropologie places up larger same-store gross sales positive factors, executives mentioned they’re making an attempt to “modernize” what’s on its cabinets, providing refreshed denim and costume alternatives in an effort to draw extra clients beneath 40.

Source web site: www.marketwatch.com

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