Today, shares of Urban Outfitters (NASDAQ:URBN) dropped over 15 percent after the apparel retailer reported net profits down to US$32.8 million for the first quarter 2015, lower than the 37.5 million a year earlier.
Overall group sales increased rose to $739 million from $686.3 million, as same-store sales increased 4%, less than the respective FactSet consensus of $758 million and 5.2% growth.
Slower sales have forced the retailer to revamp stores to attract more customers in order to reduce inventories, which grew 14% in the first quarter.
But earnings per share increased from US$0.26 to US$0.25 cents per share for the period, below the analysts’ consensus of US$0.30 per share.
The company’s higher end Anthropologie brand, featuring more sophisticated styles intended to attract more mature women, aged 28-45,failed to meet expectations.
Yet, in the words of Anthropologie’s own CEO, David McCreight, the brand’s overall same store sales were “a disappointment and a bit of a surprise,” growing only one percent.
Among its other brands, same-store sales rose 5% at Urban Outfitters and 17% at Free People climbed 17%. Growth expectations were 4.1%, 12.3% and 4.5%, respectively.
Urban Outfitters said its Group CEO Tedford Marlow will retire in August of this year.